How beneficial is healthcare?

Mar 22 JDN 2458931

Healthcare has been a contentious issue in the US for generations, but became especially so during the Obama administration with the passage of the Affordable Care Act. To be honest, I never quite understood the opposition to transitioning to a single-payer healthcare system; we already spend as much public funds on healthcare as most other First World countries spend in their entire healthcare system (plus we spend even more than that on private spending!), so not only can we afford it—it would in fact save us trillions of dollars a year. We might not even have to raise taxes, but even if we did, we’d pay so much less out of pocket that most of us would end up with more money. I understand why the corporations that run HMOs don’t want single-payer; but why does anyone else oppose it?

It’s not as if there are no models to follow; we could literally just copy the Canadian system (or the British system, or the French system…). It’s always amusing to me when conservatives respond to the suggestion by: “But that’s socialism! Do you want to end up like Cuba?” First of all, I said copy Canada, not copy Cuba. But even if we did copy Cuba, healthcare is one of the few things that Cuba actually does extremely well. On a QALY-per-dollar basis, it’s probably the most cost-effective healthcare system in the world (and the US is probably the least). So yeah, you know what? I kinda do want to end up like Cuba.

And no, countries with single-payer healthcare systems do not have longer wait times. Even by standard measures, our wait types are in the middle of the pack. But in fact these standard measures are clearly biased in our favor. The main way that we reduce wait times is by excluding people from care entirely. That’s not a wait time of zero; it’s a wait time of the rest of your life. If we measured properly, we would clearly have the longest wait times in the First World, because of all those people who never get care at all.

But today I’m going to ask a different question:

How much harm is done by our awful healthcare system?

Or conversely:

How much benefit would we get from insuring everyone?

The largest randomized controlled experiment on health insurance in the United States was the RAND Health Insurance Experiment, and its results were quite surprising: The marginal benefit of better health insurance for most people was very small, in many cases statistically negligible. People who were very poor or very sick benefited from having health insurance, but everyone else used more medical care without getting much apparent benefit. Since this was a large randomized controlled experiment, it should probably be considered our most credible evidence.

On the other hand, the RAND study was done before I was born, so maybe it’s time for a new study?

More recent studies have used regression discontinuity analysis, looking to see if going on Medicare seems to change the trendline in your mortality rate. It doesn’t.Of course mortality rates go up as you get older, and people become eligible for Medicare by getting older… but still, if Medicare is helping, you’d think there would be some kind of kink in the trend, and as far as we can tell, there isn’t. Perhaps people are simply transitioning from one form of adequate health insurance (e.g. employer-provided insurance) to another.

There is some evidence that healthcare saves lives, if we restrict attention specifically to what is called mortality amenable to healthcare, deaths caused by diseases that we know can be effectively treated by medical intervention. (It’s really a continuum, with malaria at one end, and airstrikes at the other. Both kill thousands of people every year, but malaria can be treated with a few doses of quinine, while there’s nothing anyone can do for you if you were in the blast center of a Hellfire missile. In between we have diseases like cancer, which medicine can sometimes save you from but not always.) By this measure, the United States clearly lags behind other First World countries, and the reason is clearly that we deny a lot of people healthcare.

However, I think mortality is really the wrong measure to use, for the following reason: We already have a universal healthcare system when it’s literally a question of life or death, and that’s the ER system. The Emergency Medical Treatment and Labor Act, signed by Ronald Reagan (yes, Republicans also used to like saving poor people from diseases, not so long ago!), guarantees that anyone who needs emergency care can get it immediately, regardless of their ability to pay. They can still bill you later, which may be a big reason why medical costs are the leading cause of bankruptcy in the United States (and literally nowhere else in the world). But at least you won’t die.

A lot of it actually comes down to how we measure health. Self-reported measures are notoriously unreliable in various ways, yet ultimately I don’t see how we can tell whether someone is sleeping well, feeling energetic, or being in pain without asking them. Correlating self-reported measures with objective measures like records of doctor visits shows pretty good correspondence, albeit by no means perfect.

As healthcare spending has increased and medical technology has advanced, there has been a worldwide trend of reduced disability and mortality, and the US is no exception. Clearly healthcare is doing something.

Yet it remains a fair question whether most people need more healthcare—maybe we’re actually getting enough. Maybe most people’s health insurance is already adequate, and we don’t need to improve it in any substantial way.

On balance, I think the best evidence we have says that people who have no insurance at all, or really awful insurance, would strongly benefit from improved access to healthcare. There’s also evidence that people with severe chronic conditions benefit from having steady healthcare. But for most people most of the time, the benefits of more health insurance would be quite small.

Does this mean we should get rid of health insurance? Of course not. But it does mean that future reforms should be focused on getting it to people who have none, not improving it for people who already have it. We don’t need to lower co-pays or deductibles; we may not even need to raise or remove coverage caps. But we do need to get some kind of health insurance to people who don’t have any at all.
To this end, Obamacare has done fairly well: You can just look at a graph of the number of uninsured people in the US and see that not only did Obamacare reduce that number, the steady attempts to undermine Obamacare are starting to bring it back up.

Then again, a single-payer system would clearly do even better, maybe even get that number to zero… so explain to me again why we’re not doing this?

Monopsony is all around us

Mar 15 JDN 2458924

Perhaps because of the board game (the popularity of which honestly baffles me; it’s really not a very good game!), the concept of monopoly is familiar to most people: A market with one seller and many buyers can command high prices and high profits for the seller.

But the opposite situation, a market with many sellers and one buyer, is equally problematic, yet far less well-known. This is called monopsony. Whereas in a monopoly prices are too high, in a monopsony prices are too low.

I have long suspected, but the data now confirms, that the most widespread form of monopsony occurs in labor markets. This is a particularly bad place for monopsony, because it means that instead of consumer prices being lower, wages will be lower. Monopsonistic labor markets are bad in two ways: They lower wages and they increase unemployment.

Monopsonistic labor markets are one of the reasons why raising minimum wage seems to have very little effect on employment.
In the presence of monopsony, forcing employers to increase wages won’t cause them to fire workers; it will just eat into their profits. In some cases it can actually cause them to hire more workers.

Take a look at this map, from the Roosevelt Institute:


This map is color-coded by commuting zone, based on whether the average labor market (different labor markets weighted by their number of employees) is monopsonistic. Commuting zones with only a few major employers are colored red, while those with many employers are colored green. In between are shaded orange and yellow. (Not a very colorblind-friendly coding scheme, I’m afraid.)

Basically you can see that the only places where labor markets are not monopsonistic are in major metro areas. Suburban areas are typically yellow, and rural areas are almost all orange or red.

It seems then that we have two choices for where we want to live: We can
live in rural areas and have monopsonistic labor markets with low wages and competitive real estate markets with low housing prices, or we can live in urban areas and have competitive labor markets with high wages and monopolistic real estate markets with high housing prices. There’s hardly anywhere we can live where both wages and housing prices are fair.

Actually the best seems to be Detroit! Median housing price in the Detroit area is an affordable $179,000, while median household income is a low but not terrible $31,000. This means you can pay off a house spending 30% of your income in about 10 years. That’s the American Dream, right there.

Compare this to the San Francisco area, where median housing price is $1.1 million and median income is an impressive $104,000. This means it would take over 35 years to pay off your house spending 30% of your income. (And that’s not accounting for interest!) You can make six figures in San Francisco and still be considered “low income”, because housing prices there are so absurd.

Of course, student loans are denominated in nominal terms, so you might actually be able to pay off your student loans faster living in San Francisco than you could in Detroit. Say taxes are 20%, so these become after-tax incomes of $25,000 and $83,000. Even if you spend only a third of your income on housing in Detroit and spend two-thirds in San Francisco, that leaves you with $16,600 in Detroit but $27,600 in San Francisco. Of course other prices are different too, but it seems quite likely that being able to pay $5,000 per year on your student loans is easier living in San Francisco than it is in Detroit.

What can be done about monopsony in labor markets? First, we could try to split up employers—the FTC already doesn’t do enough to break up monopolies, but it basically does nothing to break up monopsonies. But that may not always be feasible, particularly in rural areas. And there are genuine economies of scale that can make larger firms more efficient in certain ways; we don’t want to lose those.

Perhaps the best solution is the one we used to use, and most of the First World continues to use: Labor unions. Union membership in the US declined by half in the last 30 years. Europe is heavily unionized, and the most unionized of all are Scandinavian countries—probably not a coincidence that these are the most prosperous places in the world.

At first glance, labor unions seem anti-competitive: They act like a monopoly. But when you currently have a
monopsony, adding a monopoly can actually be a good thing. Instead of one seller and many buyers, resulting in prices that are too low, you can have one seller and one buyer, resulting in prices that are negotiated and can, at least potentially, be much fairer. This market structure is called a bilateral monopoly, and while it’s not as good as perfect competition, it’s considerably more efficient than either monopsony or monopoly alone.

Ancient plagues, modern pandemics

Mar 1 JDN 2458917

The coronavirus epidemic continues; though it originated in Wuhan province, the virus has now been confirmed in places as far-flung as Italy, Brazil, and Mexico. So far, about 90,000 people have caught it, and about 3,000 have died, mostly in China.

There are legitimate reasons to be concerned about this epidemic: Like influenza, coronavirus spreads quickly, and can be carried without symptoms, yet unlike influenza, it has a very high rate of complications, causing hospitalization as often as 10% of the time and death as often as 2%. There’s a lot of uncertainty about these numbers, because it’s difficult to know exactly how many people are infected but either have no symptoms or have symptoms that can be confused with other diseases. But we do have reason to believe that coronavirus is much deadlier for those infected than influenza: Influenza spreads so widely that it kills about 300,000 people every year, but this is only 0.1% of the people infected.

And yet, despite our complex interwoven network of international trade that sends people and goods all around the world, our era is probably the safest in history in terms of the risk of infectious disease.

Partly this is technology: Especially for bacterial infections, we have highly effective treatments that our forebears lacked. But for most viral infections we actually don’t have very effective treatments—which means that technology per se is not the real hero here.

Vaccination is a major part of the answer: Vaccines have effectively eradicated polio and smallpox, and would probably be on track to eliminate measles and rubella if not for dangerous anti-vaccination ideology. But even with no vaccine against coronavirus (yet) and not very effective vaccines against influenza, still the death rates from these viruses are nowhere near those of ancient plagues.

The Black Death killed something like 40% of Europe’s entire population. The Plague of Justinian killed as many as 20% of the entire world’s population. This is a staggeringly large death rate compared to a modern pandemic, in which even a 2% death rate would be considered a total catastrophe.

Even the 1918 influenza pandemic, which killed more than all the battle deaths in World War I combined, wasn’t as terrible as an ancient plague; it killed about 2% of the infected population. And when a very similar influenza virus appeared in 2009, how many people did it kill? About 400,000 people, roughly 0.1% of those infectedslightly worse than the average flu season. That’s how much better our public health has gotten in the last century alone.

Remember SARS, a previous viral pandemic that also emerged in China? It only killed 774 people, in a year in which over 300,000 died of influenza.

Sanitation is probably the most important factor: Certainly sanitation was far worse in ancient times. Today almost everyone routinely showers and washes their hands, which makes a big difference—but it’s notable that widespread bathing didn’t save the Romans from the Plague of Justinian.

I think it’s underappreciated just how much better our communication and quarantine procedures are today than they once were. In ancient times, the only way you heard about a plague was a live messenger carrying the news—and that messenger might well be already carrying the virus. Today, an epidemic in China becomes immediate news around the world. This means that people prepare—they avoid travel, they stock up on food, they become more diligent about keeping clean. And perhaps even more important than the preparation by individual people is the preparation by institutions: Governments, hospitals, research labs. We can see the pandemic coming and be ready to respond weeks or even months before it hits us.

So yes, do wash your hands regularly. Wash for at least 20 seconds, which will definitely feel like a long time if you haven’t made it a habit—but it does make a difference. Try to avoid travel for awhile. Stock up on food and water in case you need to be quarantined. Follow whatever instructions public health officials give as the pandemic progresses. But you don’t need to panic: We’ve got this under control. That Horseman of the Apocalypse is dead; and fear not, Famine and War are next. I’m afraid Death himself will probably be awhile, though.

How I’d run an airline

Mar 1 JDN 2458910

I’m traveling this week, so I have less time for blogging than usual and airlines are very much on my mind. So I thought I’d write a short post about things I would change if I were to run my own airline.

1. Instead of overpriced first-class seats, offer the option of seats with more space for a proportional amount. First class prices are almost never worth it, and people seem to be figuring that out: Use of first class is in decline. But sitting in that middle seat is so miserable, why not simply eliminate it? I think a lot of people would be willing to pay 50% more for 50% more space.

2. Offer every passenger two free checked bags, but charge for the carry-on. Carry-on bags are far more awkward and disruptive, and slow down boarding and deboarding much more, than checked bags. The airline should be trying to incentivize passengers to use checked baggage as much as possible. I’d still give each passenger a free personal item (like a purse, backpack or laptop bag), and some people would still want a carry-on bag (e.g. for cameras that can be damaged by radiation); but most people really don’t need to have a roller bag as a carry-on.

3. Power outlets in every seat. This is a trivial amount of cost in terms of manufacturing and electricity, compared to what an airplane already requires; but it makes flying much more convenient for your passengers, and thereby allows you to demand higher prices. This is a no-brainer. (Some airlines, like Delta, already do this.)

4. Assign seats and load the plane based on the seating positions. The first boarding group should be the people who sit furthest in the back, so that no one needs to pass seated passengers in order to find their own seat. Ideally window seats would be filled before aisle seats, but since people like to board and sit together, that might not be feasible. But at the very least we can make boarding faster by seating the back rows first.

5. Give pilots and flight attendants reasonable hours and plenty of vacation time. Airline pilots around the world are dangerously overworked and sleep-deprived. This is dangerous for customers, and if it leads to crashes or lawsuits it can be very expensive for the airlines too. Having an aircraft idle overnight really isn’t that great a cost, especially since red-eye flights command lower prices and are thus less profitable for the airline. Working fewer hours makes people more productive per hour—often to the point of making them more productive overall.

6. Explain why you need to put on your own oxygen mask first. Standard airplane safety instructions always include the line “Put on your mask before assisting others.” But since they almost never explain why, I strongly suspect that in a real emergency a lot of parents try to put on their children’s masks first and thereby needlessly endanger themselves. Wording these instructions might be tricky, because any talk of such things is bound to scare people, but the core idea is this: Hypoxia will cause delirium or unconsciousness long before it will cause permanent brain damage or death. You want to first make sure you aren’t incapacitated, and then you can help save others. If you put on your mask first, your kid may get confused or pass out, but you’ll be able to help them and they’ll be fine. If you put on your kid’s mask first, you may get confused or pass out, and your kid won’t be able to help you. Then unless someone else saves you, you may die pointlessly because you didn’t follow instructions. Depending on altitude and how severe the hull breach is, you have about 30 seconds before you lose consciousness. But your kid has at least three minutes before you need to worry about permanent brain damage, and probably as many as fifteen before they’d die.

7. Include carbon offsets in the ticket price, and advertise this aggressively. Despite the fact that airplanes are a major source of carbon emissions, carbon offsets are actually remarkably cheap compared to the cost of airline tickets. Adding offsets would typically raise the price of a ticket by about $30, which on a $300 ticket is unlikely to shock people. And by advertising the carbon-neutrality of your airline, you can probably get a lot of customers who are willing to pay more, potentially even more than the additional cost of the carbon offsets themselves. This could be a win-win for the airline and the environment.

8. Invest heavily in research on more efficient jet engines. The second-biggest cost for an airline is fuel expenditure. (First is the wages of the crew.) If you can install more efficient engines on your aircraft, you can both reduce your environmental impact and dramatically lower your cost. Current state-of-the-art engines can reduce fuel consumption by as much as 20%; future research could improve this even further.

9. Include snacks at every seat before passengers even board. Putting a bag of pretzels and a water bottle at every seat would be trivially easy, and would allow passengers the opportunity to be eating while the plane takes off—and chewing reduces the discomfort of changing air pressure. If the worry is that people will try to put their tray tables down (which is genuinely unsafe during takeoff), install electronic locks that prevent tray tables from being lowered except when authorized.

10. Install seats that don’t recline. The additional comfort for the passenger reclining is far smaller than the reduced comfort for the passenger behind them. Combine that with the additional cost of maintaining the seats and the additional risk of injury during rough landings, and the answer is obvious: Seats shouldn’t recline.

11. Offer better food. Charging less for airplane food honestly isn’t feasible: Because space and weight are at such a premium, it really is that expensive to store and transport food on an aircraft. But the cost comes mostly from the bulk and weight of the food; it really doesn’t much matter what kind of food it is. To that end, airlines should offer high-quality food that people feel more comfortable paying such high prices for. A steak weighs about the same as a hamburger, and champagne has about the same density as Sprite.

12. Reduce, or even eliminate, fees to change flights. Yes, it’s expensive to have empty seats on a moving airplane. But most flights can be filled by standby passengers, and those that can’t often weren’t full anyway. It’s actually fairly rare for a cancellation to result in an empty seat that would otherwise have been full. And the additional goodwill you get from making life easier for your passengers will make up the difference. (Southwest figured this out; other airlines don’t yet seem to have caught on.)

Would these changes revolutionize air travel? No. But I do think they’d make it a bit more pleasant, without greatly reducing the profits of the airline.

A Socratic open letter to transphobes everywhere

Feb 23 JDN 2458903

This post is a bit different than usual. This is an open letter to those who doubt that trans people actually exist, or insist on using the wrong pronouns; above all it is an open letter to those who want to discriminate against trans people, denying trans people civil rights or the dignity to use public bathrooms in peace. Most of my readers are probably not such people, but I think you’ll still benefit from reading it—perhaps you can use some of its arguments when you inevitably encounter someone who is.

Content warning: Because of how sex and gender are tied up together in transphobes’ minds, I’m going to need to talk a little bit about sexual anatomy and genital surgery. If such topics make you uncomfortable, feel free to skip this post.

Dear Transphobe:

First of all, I’m going to assume you are a man. Statistically you probably are, in which case that works. If by chance you’re not, well, now you know what it feels like for people to assume your gender and never correct themselves. You’re almost certainly politically right-wing, so that’s an even safer assumption on my part.

You probably think that gender and sex are interchangeable things, that the idea of a woman born with a penis or a man born without one is utter nonsense. I’m here to hopefully make you question this notion.

Let’s start by thinking about your own identity. You are a man. I presume that you have a penis. I am not going to make the standard insult many on the left would and say that it’s probably a small penis. In fact I have no particular reason to believe that, and in any case the real problem is that we as a society have so thoroughly equated penis size with masculinity with value as a human being. Right-wing attitudes of the sort that lead to discriminating against LGBT people are strongly correlated with aggressive behaviors to assert one’s masculinity. Even if I had good reason—which I assuredly do not—to do so, attacking your masculinity would be inherently counterproductive, causing you to double down on the same aggressive, masculinity-signaling behaviors. If it so happens that you are insecure in your masculinity, I certainly don’t want to make that worse, as masculine insecurity was one of the strongest predictors of voting for Donald Trump. You are a man, and I make no challenges to your masculinity whatsoever. I’m even prepared to concede that you are more manly than I am, whatever you may take that to mean.

Let us consider a thought experiment. Suppose that you were to lose your penis in some tragic accident. Don’t try to imagine the details; I’m sure the mere fact of it is terrifying enough. Suppose a terrible day were to arrive where you wake up in a hospital and find you no longer have a penis.

I have a question for you now: Should such a terrible day arrive, would you cease to be a man?

I contend that you would remain a man. I think that you, upon reflection, would also contend the same. There are a few thousand men in the world who have undergone penectomy, typically as a treatment for genital cancer. You wouldn’t even know unless you saw them naked or they told you. As far as anyone else can tell, they look and act as men, just as they did before their surgery. They are still men, just as they were before.

In fact, it’s quite likely that you would experience a phantom limb effect—where here the limb that is in your self-image but no longer attached to your body is your penis. You would sometimes feel “as if” your penis was still there, because your brain continues to have the neural connections that generate such sensations.

An even larger number of men have undergone castration for various reasons, and while they do often find that their thoughts and behavior change due to the changes in hormone balances, they still consider themselves men, and are generally considered men by others as well. We do not even consider them transgender men; we simply consider them men.

But does this not mean, then, that there is something more to being a man than simply having male anatomy?

Perhaps it has to do with other body parts, or some totality of the male body? Let’s consider another thought experiment then. Suppose that by some bizarre event you were transported into a female body. The mechanism isn’t important: Perhaps it was a mad scientist, or aliens, or magic. But just suppose that somehow or other, while you slept, your brain in its current state was transported into an entirely female body, complete with breasts, vulva, wide hips, narrow shoulders—the whole package. When you awaken, your body is female.

Such a transition would no doubt be distressing and disorienting. People would probably begin to see you as a woman when they looked at you. You would be denied access to men’s spaces you had previously used, and suddenly granted access to women’s spaces you had never before been allowed into. And who knows what sort of effect the hormonal changes would have on your mind?

Particularly if you are sexually attracted to women, you might imagine that you would enjoy this transformation: Now you get to play with female body parts whenever you want! But think about this matter carefully, now: While there might be some upsides, would you really want this change to happen? You have to now wear women’s clothing, use women’s restrooms, cope with a menstrual cycle. Everyone will see you as a woman and treat you as a woman. (How do you treat women, by the way? Is this something you’ve thought carefully about?)

And if you still think that being a woman isn’t so bad, maybe it isn’t—if your mind and body are in agreement. But remember that you’ve still got the mind of a man; you still feel that mental attachment to body parts that are no longer present, and these new body parts you have don’t feel like they are properly your own.

But throughout this harrowing experience, would you still be a man?

Once again I contend that you would. You would now feel a deep conflict between your mind and your body—dare I call it gender dysphoria?—and you would probably long to change your body back to what it was, or at least back to a body that is male.

You would once again experience phantom limb effects—but now all over, everywhere your new body deviated from your original form. In your brain there is a kind of map of where your body parts are supposed to be: Your shoulders are supposed to end here, your legs are supposed to end there, and down here there is supposed to be a penis, not vulva. This map is deeply ingrained into your mind, its billions of strands almost literally woven into the fabric of your brain.

We are presumably born with such a map: By some mindbogglingly complex mix of genetic and environmental factors our brains organize themselves into specific patterns, telling us what kind of body we’re supposed to have. Some of this structuring may go on before birth, some while we are growing up. But surely by the time we are adults the process is complete.

This mental map does allow for some flexibility: When we were young and growing, it allowed us to adjust to our ever-increasing height. Now that we are older, it allows us to adjust to gaining or losing weight. But this flexibility is quite limited: it might take years, or perhaps we could never adjust at all, to finding that we had suddenly grown a tail—or suddenly changed from male to female.

Now imagine that this transformation didn’t happen by some sudden event when you were an adult, but by some quirk of ontogeny while you were still in the womb. Suppose that you were born this way: in a body that is female, but with a mind that is male.

In such a state, surely something is wrong, in the same way that being born with sickle-cell anemia or spina bifida is wrong. There are more ambiguous cases: Is polydactyly a disorder? Sometimes? But surely there are some ways to be born that are worth correcting, and “female body, male mind” seems like one of them.

And yet, this is often precisely how trans people describe their experience. Not always—humans are nothing if not diverse, and trans people are no exception—but quite frequently, they will say that they feel like “a man in a woman’s body” or the reverse. By all accounts, they seem to have precisely this hypothetical condition: The gender of their mind does not match the sex of their body. And since this mismatch causes great suffering, we ought to correct it.

But then the question becomes: Correct it how?

Broadly speaking, it seems we’ve only two options: Change the body, or change the mind. If you were in this predicament, which would you want?

In the case of being transferred into a new body as an adult, I’m quite sure you’d prefer to change your body, and keep your mind as it is. You don’t belong in this new body, and you want your old one back.

Yet perhaps you think that if you were born with this mismatch, things might be different: Perhaps in such a case you think it would make more sense to change the mind to match the body. But I ask you this: Which is more fundamental to who you are? If you are still an infant, we can’t ask your opinion; but what do you suppose you’d say if we could?

Or suppose that you notice the mismatch later, as a child, or even as a teenager. Before that, something felt off somehow, but you couldn’t quite put your finger on it. But now you realize where the problem lies: You were born in a body of the wrong sex. Now that you’ve had years to build up your identity, would you still say that the mind is the right thing to change? Once you can speak, now we can ask you—and we do ask such children, and their answers are nigh-unanimous: They want to change their bodies, not their minds. David Reimer was raised as a girl for years, and yet he always still knew he was a boy and tried to act like one.

In fact, we don’t even know how to change the gender of a mind. Despite literally millennia of civilization trying at great expense to enforce particular gender norms on everyone’s minds, we still get a large proportion of the population deviating substantially from them—if you include mild enough deviations, probably a strict majority. If I seem a soft “soy boy” to you (and, I admit, I am both bisexual and vegetarian—though I already knew I was the former before I became the latter), ask yourself this: Why would I continue to deviate from your so ferociously-enforced gender norms, if it were easy to conform?

Whereas, we do have some idea how to change a body. We have hormonal and surgical treatments that allow people to change their bodies substantially—trans women can grow breasts, trans men can grow beards. Often this is enough to make people feel much more comfortable in their own bodies, and also present themselves in a way that leads others to recognize them as their desired gender.

Sex reassignment surgery is not as reliable, especially for trans men: While building artificial vulva works relatively well, building a good artificial penis still largely eludes us. Yet technological process in this area continues, and we’ve improved our ability to change the sex of bodies substantially in just the last few decades—while, let me repeat, we have not meaningfully improved our ability to change the gender of minds in the last millennium.

If we could reliably change the gender of minds, perhaps that would be an option worth considering. But ought implies can: We cannot be ethically expected to do that which we are simply incapable.

At present, this means that our only real options are two: We can accept the gender of the mind, change the sex of the body, and treat this person as the gender they identify themselves as; or we can demand that they repress and conceal their mental gender in favor of conforming to the standards we have imposed upon them based on their body. The option you may most prefer—accept the body, change the mind—simply is not feasible with any current or foreseeable technology.

We have tried repressing transgender identity for centuries: It has brought endless suffering, depression, suicide.

But now that we are trying to affirm transgender identity the outlook seems much better: Simply having one adult in their life who accepts their gender identity reduces the risk of a transgender child attempting suicide by 40%. Meta-analysis of research on the subject shows that gender transition, while surely no panacea, does overall improve outcomes for transgender people—including reducing risk of depression and suicide. (That site is actually refreshingly nuanced; it does not simply accept either the left-wing or right-wing ideology on the subject, instead delving deeply into the often quite ambiguous evidence.)

Above all, ask yourself: If you ever found yourself in the wrong sort of body, what would you want us to do?

Bernie Sanders may be our next President

Feb 16 JDN 2458896

It’s too early to say who will win the election, of course. In fact, we’re not even entirely sure what the results of the Iowa caucuses were, because there were so many errors that they are talking about doing a recount.

But Bernie Sanders has taken a commanding lead in polls, and forecasts now have him as the clear front-runner. If we’d had range voting, Sanders probably would have won last time. But even with our voting system as terrible as it is, there’s a good chance he’ll actually win this time.

I would honestly prefer Elizabeth Warren; she shares Bernie’s idealism, but tempers it with a deep understanding of our political and economic system. Her policy plans are spectacularly good; she doesn’t just come up with a vague idea, she lays out a detailed roadmap of how it will be accomplished and how it will be paid for. Her plans cover a wide variety of issues, including a lot of things that most people aren’t even aware of yet nevertheless affect millions of people. Who else is talking about universal child care programs, the corruption in our trade negotiation system, antitrust action against tech monopolies, or reducing corporate influence in the military? Who else includes in their plan for corporate taxes detailed reforms to the accounting system? And who else has a plan for forgiving student debt that actually calculates the effective marginal tax rate induced by the phase-out? Elizabeth Warren is the economist’s candidate: Unlike almost everyone else in politics, she actually knows what she’s doing.

Bernie Sanders, by comparison, has an awful lot of laudable goals, but is often quite short on the details of how they will be achieved. His healthcare plan, in particular, “Medicare for All”, doesn’t seem to include any kind of cost estimate or revenue support. I’m all for single-payer healthcare, but it’s not going to get done for free. And at least in the past, he has made economic forecasts that are wildly implausible.

But we could certainly do a lot worse than Bernie. His most unrealistic ideas will be tempered by political reality, while his unflinching idealism may just shift our Overton Window in a much-needed leftward direction. He is a man of uncommon principle, and a politician of uncommon honesty—he does not have even one “Pants on Fire” rating on Politifact.

To say that he would obviously be better than Trump is a gross understatement: Almost anyone would obviously be better than Trump, and definitely any of the leading Democratic candidates would be.

In fact, Warren is the only candidate I unambiguously prefer to Sanders. Biden is too conservative, too willing to compromise with an uncompromising right wing. As historic as it would be to have an openly gay President, I’m not sure Buttigieg is the one I’d want. (On the other hand, the first gay President is almost certainly going to have to be extremely privileged and milquetoast to break through that glass ceiling—so maybe it’s Buttigieg or nothing.) Yang has some interesting ideas (like his basic income proposal), but no serious chance of winning. Bloomberg would be a good Libertarian Party candidate, but he’s no Democrat. The rest have fallen so far in the polls they aren’t worth talking about anymore.

Like I said, it’s really too early to say. Maybe Biden will make a comeback. Maybe Warren will win after all. But it does mean one thing: The left wing in America has been energized. If one good thing has come of Trump, perhaps it is that: We are no longer complacent, and we are now willing to stand up and demand what we really want. The success of Sanders so far proves that.

Coase, extortion, and pay-to-skip

Feb 9 JDN 2458889

The Coase Theorem states that under perfect property rights, perfect information, perfect contract enforcement, and negligible transaction costs, Pareto efficiency can be achieved even when there are large externalities. It was designed as an argument against Pigovian taxation, which tries to use taxes to create incentives against externalities such as pollution.

The usual argument against the Coase Theorem is that transaction costs are rarely negligible and contracts are often unenforceable, so the Pareto-efficient solution to externalities that it provides is unrealistic. (In fact, Coase himself agreed with this critique, and instead argued that regulation of externalities needs to be done on a case-by-case basis with attention to the detailed context.)

Yet this is not the real problem with the Coase Theorem. The real problem is the criterion of Pareto-efficiency: An arrangement can be Pareto-efficient without being fair, just, or even economically efficient in any real sense.

As a reminder, Pareto efficiency simply says that no person can be made better off without making some other person worse off. It doesn’t say anything about how well off people are relative to one another—inequality—or how they got what they have—justice. It doesn’t even really entail economic efficiency: Supposing that the marginal utility of wealth is always positive, if one man claims all the wealth in the world and lends it out to everyone else at interest, that does seem to be Pareto-efficient—we can’t make anyone else better off without taking something from His Majesty the Supreme Emperor—but it clearly isn’t economically efficient in any desirable sense.

And this is what’s wrong with the Coase Theorem: The kind of Pareto efficiency it generates allows for—indeed, in many cases demands—what we would ordinarily call extortion.

What is extortion, after all?

If a member of the mafia comes to your house and says, “What a nice place you’ve got here; what a shame if anything happened to it!” and then demands you pay him $500 a month, that’s extortion. He has the power to inflict a negative externality on you, and he promises not to as long as you pay him. (Here, the contract enforcement actually comes from the reciprocity in the indefinitely iterated game, and doesn’t require an outside enforcer.)

Extortion is when one party has the power to create a negative externality upon another (e.g. burn your house down, punch you in the face). They make a deal: They won’t create that negative externality, provided that you compensate them (pay them money). Is this Pareto efficient? Absolutely! They’re as well off as they would be if they hurt you, and you’re better off. But is this how we want to run a society? I don’t think so.

In the cyberpunk future in which we now live, there is a market emerging that fits the requirements of the Coase Theorem as well as any which has ever existed; and sure enough, in the absence of adequate regulation it is turning to extortion.

I am referring of course to the market for online advertisements. Perfect property rights? Not quite, but that intellectual property enforcement is very strong. Perfect contract enforcement? Not perfect, but highly reliable, like any mature market in a First World country. Perfect information and negligible transaction costs? As close as humanity has ever come.

What’s the externality? People don’t like seeing ads. Ads are annoying, distracting, and unpleasant. But businesses benefit from showing people ads (or at least think they do), and seek rents by trying to post more ads than their competition. I proposed a Pigouvian solution: Tax advertising.

What’s the Coase solution? Let people pay to skip ads. And indeed there are now sites that do this.

Note that there is a vital difference between this and, say, YouTube Premium. With YouTube Premium, you’re actually paying for the opportunity to use an ad-free version of the service. So instead of advertisers paying Google to run ads on the content you watch, you’re simply paying for the content you watch. That’s great. I have no objection to that. In fact, I strongly prefer it to the ad-supported model. Paying for content makes you the customer. Accepting ads in return for free content makes you the product.

No, I’m talking about businesses posting ads, and then offering you the chance to pay them to get rid of those ads. (Maybe a cut would go to the content provider, but that’s not really important here.) The key is that the people who make the ads get the chance to get revenue from you paying to skip them.

In Coase terms, that sounds great! Instead of me having to put you through a miserable ad that probably won’t lead you to buying anything anyway, you just pay me $0.25 or something directly. I’m better off, you’re better off, everyone’s happy.

But in fact, everyone is not happy, because here’s what I can do: I can go out of my way to make the ads as obnoxious as possible, so that you have no choice but to pay me to skip them. I’m not the first one to make this point: It’s the subject of an SMBC comic and a major plot point in a Black Mirror episode.

This is precisely the same process as extortion: Threaten a negative externality, demand compensation in return for not doing so.

I think what Coase missed in his original argument is that negative externalities aren’t always by-products of otherwise productive activities. We often—nay, usually—have the power to inflict negative externalities upon other people with no productive purpose. If externalities were always by-products, negotiation as Coase imagined it could allow us to achieve the productive benefit without the externality cost. But when externalities can be generated independently, they are a means of extracting rent from those too weak to resist you.

What’s the solution to this problem? It’s boring: We have to tax and regulate externalities after all.