Government

Complex Adaptive Monetary Policy

Complex Adaptive Monetary Policy (CAMP) is, in essence, a reconciliation of Keynes’ top-down view of macroeconomics with Hayek’s bottom up view.  The particular details of the proposed policy below are not as important as the recognition of the fundamental forces at play and empirical evidence that we are at a very dangerous chaos point in history.  Both Keynes and Hayek have deep truths to tell, and we discount one or the other at our collective peril.  For those who want a primer on the great debate, this rap battle sums it up better than any text book could.  Now on to the idea…

The fragility of the global financial system (as measured by the US dollar) is a function of the gap between rich and poor.  In the past, only a small ruling elite could decide to use capital to purchase all of the following: food/clothing/shelter; savings; insurance; personal free time; investment; starting a business; buying a private jet; leverage/volatility; political influence; fame.  Today an …

How to Be a Good Representative

Are you someone who has been given (and accepted) responsibility for someone else’s well-being?  Maybe you are an elected official?  A board member? A parent?  A friend?  If so, you may resonate with the following realization I just had about my own successes and failures in the role of Representative.

I used to believe that what a Representative does is to act and react as if they were the one being represented.  I felt like my job was to get inside their head, and channel them, sort of like a medium or a conduit.  The problem with this though is it always ends badly.  Why?  Because it’s an impossible job.

Nobody can speak for you, as if they were you.  Sure, if you know one another really, really well, then at times it can seem as though they read your mind, know what’s in your heart.  But the times I have been most frustrated in any relationship is when the other person believes and acts …

The Age of Radical Transparency

On Tuesday I went on Annie Duke’s internet TV show to talk with her and Jason Calacanis about Wikileaks and what the implications are for the future of privacy.  I made some radical claims:

  1. Privacy is dead: it’s only a matter of time now before we all have to face this eventuality.
  2. In a radically transparent society, personal willingness to share everything is a source of power/wealth; unwillingness is a personal liability.
  3. In a world with strong privacy rights, the exact opposite is true.
  4. We’re all better off in a radically transparent world than one with strong privacy rights; this is true whether you look at the individual, the corporation, or the sovereign nation.
  5. Worse than both extremes is where we are now, in transition, where some have privacy and others don’t.
  6. Those who insist on having privacy will have to pay an increasing price for it; and because of #5, this is a good thing.
  7. In the mean time, as the walls of privacy

Four Ways to Fix a Broken Legal System (TED 2010)

This was one of my favorites of the year.…

Switching Government Service Providers

Ever wish you could reinvent the entire systems of government you live under without starting a costly war, revolution or having to win an election?  No?  Well, Patri Friedman has (wondered, that is).  And so has a growing number of seasteaders, ordinary folks (and the occasional PayPal billionaire).  Or to be more precise, as Patri explained at this year’s Idea Project confab [sign up now for next year, it may sell out quick!] they believe we should at least get to choose from some reasonable options.  Currently your choices are some form of democracy, autocracy, or theocracy.  And switching costs are high.

What if you wanted to start your own sovereign nation in a tucked away corner of earth somewhere?  Problem is, every piece of land more than a few feet above sea level is already claimed by governments, private individuals or commercial interests.  Enter, the high seas.  Turns out there’s nothing stopping you from going out to international waters, building a platform, giant …

The Link Between Food & Healthcare Reform

Also must-read this Sunday is Michael Pollan’s NY Times Op-Ed piece from Wednesday.  Nice cap to my week of ranting on the dismantling of rationality when it comes to lifestyle choices that directly impact one’s health, here and here.…

What Obama Needs to Do

The old philosophical theory says that reason is conscious, can fit the world directly, is universal (we all think the same way), is dispassionate (emotions get in the way of reason), is literal (no metaphor or framing in reason), works by logic, is abstract (not physical) and functions to serve our interests. Language on this view is neutral and can directly fit, or not fit, reality.

The scientific research in neuroscience and cognitive science has shown that most reason is unconscious. Since we think with our brains, reason cannot directly fit the world. Emotion is necessary for rational thought; if you cannot feel emotion, you will not know what to want or how anyone else would react to your actions. Rational decisions depend on emotion. Empathy with others has a physical basis, and as much as self-interest, empathy lies behind reason.

This is part of a brilliant article by cognitive science and linguistics pioneer, George Lakoff (emphasis mine).  His argument about what …

Health Care Parallels Education

I was listening today to a Fresh Air interview from a couple of weeks ago on the reasons for the high cost of health care:

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Highly informative and thought provoking. One thing that struck me was the discussion about how we don’t pay primary care physicians enough and that specialists make a majority of the dollars. This is not earth shattering news, but it I was reminded of a similar problem in higher education. Specialization is highly valued where as general studies and thinking/life skills are not, despite the fact that it’s these more general abilities and knowledge that determine how successful you are in your chosen trade (specialized or not). Same thing in medical care: it’s not the specialists who have the most impact on your health and mortality, it’s …

Name That Financial Debacle!

The following quotes are from a book describing a real set of events:

[The incident] is an extraordinary example of what happens when you get… a dozen people with an average IQ of 160… working in a field in which they collectively have 250 years of experience… employing a ton of leverage.

It’s hard to overstate the significance of a [government-led] rescues of a private [corporation].  If a [company], however large was too big to fail, then what large [company] would ever be allowed to collapse?  The government risked becoming the margin of safety.  No serious consequences had come about in the end from the… near-meltdown.

Was the incident:

a) The savings and loan scandal

b) The collapse of Enron

c) The sub-prime mortgage meltdown

d) none of the above

First correct answer gets to invest in an exciting new bridge project I’m involved with in New York!…

Should We Tax Poor Nutrition?

I just tweeted on a subject that I suspected would cause a stir, and so it has, I’m moving it here:

RafeFurst: I strongly support a soda tax! RT @mobilediner: check it out:  a Soda Tax? http://amplify.com/u/dvl

coelhobruno: @RafeFurst what about diet soda? Would it be exempt?

RafeFurst: @coelhobruno no diet soda would not b exempt from tax.  Tax should be inversely proportional to total nutritional content.  Spinach = no tax

Lauren Baldwin: I do as well … and while they are at it they should tax fake fruit juice too.

Kevin Dick: I think this would be an interesting experiment. I predict a tax does not cause any measurable decrease in BMI.

Kim Scheinberg: New York has had this under consideration for a year.  Perhaps surprisingly, I’m against it. In theory, people will drink less soda. In reality, it will just be another tax on people who can afford it the least.

Leaving aside the “rights” issues and …

Paying Women to Not Get Pregnant

What’s fascinating to me about this is not that it works so well and or that there might actually be support in the Obama administration for doing it on a national scale, but rather that there has not been a backlash against it yet.  What are the odds that something like this will actually get implemented?  Is it actually a good thing?

hat tip: Annie Duke’s mom

Stability Through Instability

A friend pointed me to a doubly prescient talk given by George Soros in 1994 about his theory of reflexivity in the markets.  Essentially Soros notes that there’s feedback in terms of what agents believe about the market and how the market behaves.  Not groundbreaking, but he takes this thinking to some logical conclusions which are in contrast to standard economic theory:…

Physics.Cancer.GOV

Yesterday, from the Director of the National Cancer Institute, addressing one of the two largest cancer research conferences of the year:

NCI commenced a series of workshops that began to bring aspects of the physical sciences to the problem of cancer. We discussed how physical laws governing short-range and other forces, energy flows, gradients, mechanics, and thermodynamics affect cancer, and how the theories of Darwinian and somatic evolution can better help us understand and control cancer.

Read more on my Cancer Complexity Forum post.…

Crowdsourcing Election Verification, part 3

In part 1 I advocated photographing your completed ballot before submitting it and posting your photograph online.  Turns out that if you followed this piece of advice in Missouri, you might be in jail right now.  Oops!  Sorry :-)…

If Rafe Were In Charge: Major Medical Edition

Kevin started an interesting discussion that included a thoughtful proposal for the problem of major medical care costs risk mitigation.  You should read that here before reading my proposal below.

Part 1: Major Medical Annuities. Federally mandated/funded (similar to SSI/Medicare), with a specific initial lifetime value that is the same for everyone. The concept is that you pick a number slightly bigger than the average expected lifetime major medical bill and set aside that pot of money for everyone individually. At some point (e.g. 65) you can choose to start drawing down from your pot as taxable income. Prior to then, the only way the fund can be used is for major medical expenses not covered by other insurance you may have. Such payments go directly to providers and are tax-exempt. When you die, any leftover amount gets transferred to the MMA accounts of your heirs (per your desired breakdown, or according to probate law in the absence of a will).…

Leveraging Taxes for Civil Engagement

Dan Ariely had an interesting idea on NPR’s Marketplace today.  Here’s the audio of the segment.  The idea is to get tax payers thinking about how their tax dollars should be spent, thus getting them more civilly engaged.  His research and that of others suggests that such activity would reduce the propensity to cheat on one’s taxes, and may even get people to pay more than they would otherwise.…

Is the Party Over?

I don’t like the Republican or Libertarian parties. But I’m also no fan of the Democratic party. In fact, I dislike all political parties and think they should be done away with.  And while I’m not naive enough to think that this will happen, it makes me glad to see that the “post partisan” utopia is closer today than it was a year ago.…

Too Big to Fail = Too Big to Exist?

I asked this question on twitter/facebook and got a lot of variants of “I agree” and only one person who stated disagreement (but provided inadequate reason, IMO).  Jay Greenspan put it this way:

Interesting question this morning, and something I’ve been wondering about. I’ve yet to see anyone really argue that state of non-regulation we’ve been in for the last years has been a good idea.  I’ve heard some thoughtful conservatives talk about how their views have changed radically — coming to understand that forceful regulation is absolutely necessary.

The super-conservatives I’ve seen are talking more about taxes, avoiding the subject. I’d be very interested to see a credible argument for a hands-off approach.

So how about it, anyone game to take up a considered argument for not mandating that companies who get big enough to affect the global economy should be broken up or otherwise handicapped?…

3 Interesting Articles on The Economy

1) The Quiet Coup

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.

Victory Over "War on Terror"

For those of who understand the power of self-fulfilling prophecy, there’s some good news on the foreign policy front.  The Obama administration (thanks to Hillary Clinton) will not be using the phrase “war on terror” anymore, as it is widely deemed to be “overly militaristic and perhaps counterproductive.”  Amen!

hat tip: Daniel Horowitz

American Recovery and Reinvestment Act of 2009

Has anyone read the entire text of the stimulus package?

The ambiguity of this question is intentional.

Powerful Images

Click here to see the whole set.

hat tip: mom

Global Economic Constitution?

U.S. Government is Open for Questions

Taking the cue from social software sites like Digg, the Obama transition team is leveraging the wisdom of your crowd to find out what the most important and relevant questions are that the public wants answered.  Judging from the top page of questions as voted by several hundred thousand people, the relevance/importance quotient is very high.  Below is the email that tipped me off to this latest development in “government 2.0”.…

Should We Hold the Bush Administration Accountable?

Paul Phillips’s blog entry quoting Greenwald on Bill Moyers sums up it up pretty well.  And I’ve wondered what the Obama administration is going to do about this and what they should do.  The arguments for not pursuing the Bush administration’s crimes are good ones.  We have such big fish to fry with the economy, climate and wars that it would be a huge distraction right now.  And secondarily, it would come off as divisiveness in a time when we need it least, not to mention that it was one of Obama’s main campaign promises change the culture of partisan politics that has plagued us for so long.…