Stop telling people they need to vote. Tell them they need to cast informed votes.

Feb 11 JDN 2458161

I just spent last week’s post imploring you to defend the norms of democracy. This week, I want to talk about a norm of democracy that I actually think needs an adjustment.

Right now, there is a very strong norm that simply says: VOTE.

“It is our civic duty to vote.” “You are unpatriotic if you don’t vote.” “Voting is a moral obligation.” Etc.

The goal here is laudable: We want people to express the altruistic motivation that will drive them to escape the so-called Downs Paradox and actually go vote to make democracy work.

But the norm is missing something quite important. It’s not actually such a great thing if everyone just goes out and votes, because most people are seriously, disturbingly uninformed about politics.

The norm shouldn’t be that you must vote. The norm should be that you must cast an informed vote.

Best if you vote informed, but if you won’t get informed, then better if you don’t vote at all. Adding random noise or bias toward physical attractiveness and height does not improve electoral outcomes.

How uninformed are voters?

Most voters don’t understand even basic facts about the federal budget, like the fact that Medicare and Social Security spending are more than defense spending, or the fact that federal aid and earmarks are tiny portions of the budget. A couple years ago I had to debunk a meme that was claiming that we spend a vastly larger portion of the budget on defense than we actually do.

It gets worse: Only a quarter of Americans can even name all three branches of government. Almost half couldn’t identify the Bill of Rights. We literally required them to learn this in high school. By law they were supposed to know this.

But of course I’m not one of the ignorant ones, right? In a classic case of Dunning-Kruger Effect, nobody ever thinks they are. When asked to predict if they would pass the civics exam required to obtain citizenship, 89% of voters surveyed predicted they would. When they took it, only 17% actually passed it. (For the record, I took it and got a perfect score. You can try it yourself here.)

More informed voters already tend to be more politically engaged. But they are almost evenly divided between Democrats and Republicans, which means (especially with the way the Electoral College works) that elections are primarily determined by low-information voters. Low-information voters were decisive for Trump in a way that is unprecedented for as far back as we have data on voter knowledge (which, sadly, is not all that far back).

To be fair, more information is no panacea; humans are very good at rationalizing beliefs that they hold for tribal reasons. People who follow political news heavily typically have more distorted views on some political issues, because they only hear one side and they think they know but they don’t. To truly be more informed voters we must seek out information from reliable, nonpartisan sources, and listen to a variety of sources with differing views. Get your ideas about climate change from NPR or the IPCC, not from Huffington Post—and certainly not from Fox News. But still, maybe it’s worth reading National Review or Reason on occasion. Even when they are usually wrong, it is good for you to expose yourself to views from the other side—because sometimes they can be right. (Reason recently published an excellent article on the huge waste of government funds on building stadiums, for example, and National Review made some really good points against the New Mexico proposal to mandate college applications for high school graduates.)

And of course even those of us who are well-informed obviously have lots of other things we don’t know. Given my expertise in economics and my level of political engagement, I probably know more about politics than 99% of American voters; but I still can’t name more than a handful of members of Congress or really any state legislators aside from the ones who ran for my own district. I can’t even off the top of my head recall who heads the Orange County Water District, even though they literally decide whether I get to drink and take a shower. I’m not asking voters to know everything there is to know about politics, as no human being could possibly do such a thing. I’m merely asking that they know enough basic information to make an informed decision about who to vote for.

Moreover, I think this is a unique time in history where changing this norm has really become viable. We are living in a golden age of information access—almost literally anything you could care to know about politics, you could find in a few minutes of Google searching. I didn’t know who ran my water district, but I looked it up, and I do now: apparently Stephen R. Sheldon. I can’t name that many members of Congress, but I don’t vote for that many members of Congress, and I do carefully research each candidate running in my district when it comes time to vote. (In the next California state legislature election, Mimi Walters has got to go—she has consistently failed to stand against Trump, choosing her party over her constituency.)

This means that if you are uninformed about politics and yet still vote, you chose to do that. You aren’t living in a world where it’s extremely expensive or time-consuming to learn about politics. It is spectacularly easy to learn about politics if you actually want to; if you didn’t learn, it was because you chose not to learn. And if even this tiny cost is too much for you, then how about this? If you don’t have time to get informed, you don’t have time to vote.

Voting electronically would also help with this. People could, in the privacy of their own homes, look up information on candidates while their ballots are right there in front of them. While mail-in voter fraud actually does exist (unlike in-person voter fraud, which basically doesn’t), there are safeguards already in widespread use in Internet-based commerce that we could institute on electronic voting to provide sufficient protection. Basically, all we need to do is public-key signing: issue every voter a private key to sign their votes, which are then decrypted at the county office using a database of public keys. If public keys were stolen, that could compromise secret-ballot anonymity, but it would not allow anyone to actually change votes. Voters could come in person to collect their private keys when they register to vote, at their convenience weeks or months before the election. Of course, we’d have to make it user-friendly enough that people who aren’t very good with computers would understand the system. We could always leave open the option of in-person voting for anyone who prefers that.

Of course, establishing this norm would most likely reduce voter turnout, even if it did successfully increase voter knowledge. But we don’t actually need everyone to vote. We need everyone’s interests accurately represented. If you aren’t willing to get informed, then casting your vote isn’t representing your interests anyway, so why bother?

False equivalence is not centrism

False equivalence is not centrism

Feb 4 JDN 2458154

Turning and turning in the widening gyre

The falcon cannot hear the falconer;

Things fall apart; the centre cannot hold;

Mere anarchy is loosed upon the world,

The blood-dimmed tide is loosed, and everywhere

The ceremony of innocence is drowned;

The best lack all conviction, while the worst

Are full of passionate intensity.

~ W.B. Yeats, The Second Coming

Centrism is not very popular these days, but I believe this is because neither its alleged adherents nor its alleged opponents actually have a clear understanding of what centrism is supposed to be. Most of what is called “centrism” in this polarized era (the US is now more politically polarized than it has been in decades) is actually false equivalence.

Most people who express pride in their “centrism” adopt a heuristic which basically amounts to taking the two positions that are most loudly proclaimed in public and averaging them. One side says “Kill all puppies”, the other side says “Don’t kill puppies”, and they proudly and self-righteously declare that the only sensible policy is to kill precisely 50% of the puppies. Anyone who says “the two parties are the same” or “liberals deny science too” is guilty of this false equivalence—and it’s all too common.

But this is not what centrism is supposed to be. A good centrist isn’t someone who looks at their existing Overton Window and chooses the mean value. A good centrist is someone who understands and appreciates Horseshoe Theory. Horseshoe Theory says that the political spectrum is not actually a straight line from left to right; it’s more of a horseshoe shape, where the far-left and the far-right curl down and toward one another. A good centrist is someone who values the top of the horseshoe, more strongly than they value whatever particular policies might move you toward the left or the right edge.

What does the top of the horseshoe represent? Democracy.

A good centrist is someone who really, truly believes in defending democracy.

What the far-left and the far-right have in common is authoritarianism:

For those on either edge of the horseshoe, people who disagree with (the collectivization of all wealth/the superiority of my master race) aren’t simply wrong, they are evil. Persuading them to vote my way is a waste of time. Freedom of speech is dangerous, because it allows them to spread their evil ideas. It would be better to suppress freedom of speech, so that only people who know the truth (read: agree with me) are allowed to speak.

Along similar lines, Slate Star Codex recently published an excellent blog post on how people seem to separate into two very broad political worldviews: There are Mistake Theorists, who think that most of the world’s problems are due to honest ignorance and error; and there are Conflict Theorists, who think that most of the world’s problems are due to the malign influence of evil enemy factions. The far-left and the far-right are overwhelmingly composed of Conflict Theorists. A good centrist is a Mistake Theorist through and through.

Being a good centrist means fighting to defend the institutions that make freedom possible. Here is a whole list of policies that neither the far-left nor the far-right particularly values that we as centrists must:

  1. Voting rights: We must fight against voter suppression and disenfranchisement wherever it occurs. We must stand up to defend the principle “one person, one vote” wherever necessary.
  2. Equality under the law: We must protect the rights of everyone to have equal representation and equal standing as citizens—including, but by no means limited to, women, racial minorities, LGBT people, and people with disabilities.

  3. Election reform: We must find ways to undermine gerrymandering, the Electoral College, and the campaign finance system that allows corporations and wealthy individuals to exert disproportionate influence.

  4. Freedom of speech: We must protect the right of everyone to speak, including those whose views we find abhorrent. Our efforts should be focused most on those who have the least representation in our discourse.

  5. Individual privacy: We must fight against the creeping rise of the surveillance state and the use of extra-legal means of intelligence gathering, particularly in domestic spying. We should be outraged that the House of Representatives voted to extend the NSA’s warrantless wiretap authority after what Edward Snowden revealed about the NSA.

  6. Demilitarization and deincarceration: We must fight to contain or reverse the expansion of military and penal force that has given the United States not only a military larger than the next ten countries combined, but also the world’s highest rate of incarceration.

On some of these issues we might find agreement with the left or (less likely) the right—but even when we don’t, we must press forward. In particular, the goal of equality under the law often aligns with the goal of left-wing social justice—but there are cases where it doesn’t, cases where hatred of White straight men or a craving for vengeance against past injustice drives the left to demand things that would violate this principle. And the atavistic joy of punching Nazis in the face must never overwhelm our sacred commitment to the principles of free speech.

This doesn’t mean we can’t also adopt detailed policy views that align with the left or the right (or both). I for one support single-payer healthcare (left), progressive taxation (left), renewable energy (left), open borders (left), zoning reform (right), reductions in corporate taxes (right), free trade (right, or so I thought?), and a basic income (both—yet strangely we can’t seem to make it happen).

But being a good centrist means that these detailed policy prescriptions are always less important to you than the core principles of democracy itself. When they find out that the rest of the country is against them on something, a leftist or a rightist starts looking for ways to undermine the public will and get the policy they want. A centrist accepts that they have been outvoted and starts looking for ways to persuade the majority that they are mistaken.

Centrism is about defending the guardrails of democracy. False equivalence is not centrism; it is an obstacle to centrism. It prevents us from seeing when one side has clearly damaged those guardrails much more than the other. So let me come out and say it: At this historical juncture, in the United States, the right wing is a far greater threat to the core principles of democracy than the left. This is not to say that the left is inherently incapable of threatening democracy, or never will do so in the future; but it is to say that right here, right now, it’s the right wing we should be worried about. Punching Nazis will never be as threatening to the core of freedom as warrantless wiretaps or the discrediting of the mainstream press.

Did the World Bank modify its ratings to manipulate the outcome of an election in Chile?

Jan 21 JDN 2458140

(By the way, my birthday is January 19. I can’t believe I’m turning 30.)

This is a fairly obscure news item, so you may have missed it. It should be bigger news than it is.
I can’t fault the New York Times for having its front page focus mainly on the false missile alert that was issued to some people in Hawaii; a false alarm of nuclear attack definitely is the most important thing that could be going on in the world, short of course of actual nuclear war.

CNN, on the other hand, is focused entirely on Trump. When I first wrote this post, they were also focused on Trump, mainly interested in asking whether Trump’s comments about “immigrants from shithole countries” was racist. My answer: Yes, but not because he said the countries were “shitholes”. That was crude, yes, but not altogether inaccurate. Countries like Syria, Afghanistan, and Sudan are, by any objective measure, terrible places. His comments were racist because they attributed that awfulness to the people leaving these countries. But in fact we have a word for immigrants who flee terrible places seeking help and shelter elsewhere: Refugees. We call those people refugees. There are over 10 million refugees in the world today, most of them from Syria.

So anyway, here’s the news item you should have heard about but probably didn’t: The Chief Economist of the World Bank (Paul Romer, who coincidentally I mentioned in my post about DSGE models) has opened an investigation into the possibility that the World Bank’s ratings of economic freedom were intentionally manipulated in order to tilt a Presidential election in Chile.

The worst part is, it may have worked: Chile’s “Doing Business” rating consistently fell under President Michelle Bachelet and rose under President Sebastian Piñera, and Piñera won the most recent election. Was that the reason he won? Who knows? I’m still not entirely clear on how we ended up with President Trump. But it very likely contributed.

The World Bank is supposed to be an impartial institution representing the interests of global economic development. I’m not naive; I recognize that no human institution is perfect, and there will always be competing political and economic interests within any complex institution. Development economists are subject to cognitive biases just like anyone else. If this was the work of a handful of economic analysts (or if Romer turns out to be wrong and the changes in statistical methodology were totally reasonable), so be it; let’s make sure that the bias is corrected and the analysts involved are punished.

But I fear that the rot may run deeper than this. The World Bank is effectively a form of unelected international government. It has been accused of inherent pro-capitalist (or even racist) bias due to the fact that Western governments are overrepresented in its governance, but I actually consider that accusation unfair: There are very good reasons to make sure that your international institutions are managed by liberal democracies, and turns out that most of the world’s liberal democracies are Western. The fact that the US, France, Germany, and the UK make most of the decisions is entirely sensible: Those are in fact the countries we should want making global decisions.

China is not underrepresented, because China is not a democracy and doesn’t deserve to be represented. They are already more represented in the World Bank than they should be, because representing the PRC is not actually representing the interests of the people of China. Russia and Saudi Arabia are undeniably overrepresented. India is underrepresented; they should be complaining. Some African democracies, such as Namibia and Botswana, would also have a legitimate claim to underrepresentation. But I don’t lose any sleep over the fact that Zimbabwe and Iran aren’t getting votes in the World Bank. If and when those countries actually start representing their people, then we can talk about giving them representation in world government. I don’t see how refusing to give international authority to dictators and theocrats constitutes racism or pro-capitalist bias.

That said, there are other reasons to think that the World Bank might actually have some sort of pro-capitalist bias. The World Bank was instrumental in forming the Washington Consensus, which opened free trade and increase economic growth worldwide, but also exposed many poor countries to risk from deregulated financial markets and undermined social safety nets through fiscal austerity programs. They weren’t wrong to want more free trade, and many of their reforms did make sense; but they were at best wildly overconfident in their policy prescriptions, and at worst willing to sacrifice people in poor countries at the altar of bank profits. World poverty has in fact fallen by about half since 1990, and the World Bank has a lot to do with that. But things may have gone faster and smoother if they hadn’t insisted on removing so many financial regulations so quickly without clear forecasts of what would happen. I don’t share Jason Hickel’s pessimistic view that the World Bank’s failures were intentional acts toward an ulterior agenda, but I can see how it begins to look that way when they keep failing the same ways over and over again. (I instead invoke Hanlon’s razor: “Never attribute to malice that which is adequately explained by stupidity.”)

There are also reports of people facing retaliation for criticizing World Bank projects, including those within the World Bank who raise ethical concerns. If this was politically-motivated data manipulation, there may have been people who saw it happening, but were afraid to say anything for fear of being fired or worse.

And Chile in particular has reason to be suspicious. The World Bank suddenly started giving loans to Chile when Augusto Pinochet took power (the CIA denies supporting the coup, by the way—though, given the source, I can understand why one would take that with a grain of salt), and did so under the explicit reasoning that an authoritarian capitalist regime was somehow “more trustworthy” than a democratic socialist regime. Even in the narrow sense of financial creditworthiness that seems difficult to defend; the World Bank knew almost nothing about what kind of government Pinochet was going to create, and in fact despite the so-called “Miracle of Chile”, rapid economic growth in Chile didn’t really happen until the 1990s, after Chile became a democratic capitalist regime.

What I’m really getting at here is that the World Bank has a lot to answer for. I am prepared to believe that most of these actions were honest mistakes or ideological blinders, rather than corruption or cruelty; but even so, when millions of lives are at stake, even honest mistakes aren’t so forgivable. They should be looking for ways to improve their internal governance to make sure that mistakes are caught and corrected quickly. They should be constantly vigilant for biases—either intentional or otherwise—that might seep into their research. Error should be met with immediate correction and public apology; malfeasance should be met with severe punishment.

Perhaps Romer’s investigation actually signals a shift toward such a policy. If so, this is a very good thing. If only we had done this, say, thirty years ago.

What about a tax on political contributions?

Jan 7, JDN 2458126

In my previous post, I argued that an advertising tax could reduce advertising, raise revenue, and produce almost no real economic distortion. Now I’m going to generalize this idea to an even bolder proposal: What if we tax political contributions?

Donations to political campaigns are very similar to advertising. A contest function framework also makes a lot of sense: Increased spending improves your odds of winning, but it doesn’t actually produce any real goods.

Suppose there’s some benefit B that I get if a given politician wins an election. That benefit could include direct benefits to me, as well as altruistic benefits to other citizens I care about, or even my concern for the world as a whole. But presumably, I do benefit in some fashion from my favored politician winning—otherwise, why are they my favored politician?

In this very simple model, let’s assume that there are only two parties and two donors (obviously in the real world there are more parties and vastly more donors; but it doesn’t fundamentally change the argument). Say I will donate x and the other side will donate y.

Assuming that donations are all that matter, the probability my party will win the election is x/(x+y).

Fortunately that isn’t the case. A lot of things matter, some that should (policy platforms, experience, qualifications, character) and some that shouldn’t (race, gender, age, heightpart of why Trump won may in fact be that he is tall; he’s about 6’1”.). So let’s put all the other factors that affect elections into a package and call that F.

The probability that my candidate wins is then x/(x+y) + F, where F can be positive or negative. If F is positive, it means that my candidate is more likely to win, while if it’s negative, it means my candidate is less likely to win. (If you want to be pedantic, the probability of winning has to be capped at 0 and 1, but this doesn’t fundamentally change the argument, and only matters for candidates that are obvious winners or obvious losers regardless of how much anyone donates.)

The donation costs me money, x. The cost in utility of that money depends on my utility function, so for now I’ll just call it a cost function C(x).
Then my net benefit is:
B*[x/(x+y)+F] – C(x)

I can maximize this by a first-order condition. Notice how the F just drops out. I like F to be large, but it doesn’t affect my choice of x.

B*y/(x+y)^2 = C'(x)

Turning that into an exact value requires knowing my cost function and my opponent’s cost function (which need not be the same, in general; unlike the advertising case, it’s not a matter of splitting fungible profits between us), but it’s actually possible to stop here. We can already tell that there is a well-defined solution: There’s a certain amount of donation x that maximizes my expected utility, given the amount y that the other side has donated. Moreover, with a little bit of calculus you can show that the optimal amount of x is strictly increasing in y, which makes intuitive sense: The more they give, the more you need to give in order to keep up. Since x is increasing in y and y is increasing in x, there is a Nash equilibrium: At some amount x and y we each are giving the optimal amount from our perspective.

We can get a precise answer if we assume that the amount of the donations is small compared to my overall wealth, so I will be approximately risk-neutral; then we can just say C(x) = x, and C'(x) = 1:

B*y/(x+y)^2 = 1
Then we get essentially the same result we did for the advertising:

x = y = B/4

According to this, I should be willing to donate up to one-fourth the benefit I’d get from my candidate winning in donations. This actually sounds quite high; I think once you take into account the fact that lots of other people are donating and political contributions aren’t that effective at winning elections, the optimal donation is actually quite a bit smaller—though perhaps still larger than most people give.

If we impose a tax rate r on political contributions, nothing changes. The cost to me of donating is still the same, and as long as the tax is proportional, the ratio x/(x+y) and the probability x/(x+y) + F will remain exactly the same as before. Therefore, I will continue to donate the same amount, as will my opponent, and each candidate will have the same probability of winning as before. The only difference is that some of the money (r of the money, to be precise) will go to the government instead of the politicians.

The total amount of donations will not change. The probability of each candidate winning will not change. All that will happen is money will be transferred from politicians to the government. If this tax revenue is earmarked for some socially beneficial function, this will obviously be an improvement in welfare.

The revenue gained is not nearly as large an amount of money as is spent on advertising (which tells you something about American society), but it’s still quite a bit: Since we currently spend about $5 billion per year on federal elections, a tax rate of 50% could raise about $2.5 billion.

But in fact this seriously under-estimates the benefits of such a tax. This simple model assumes that political contributions only change which candidate wins; but that’s actually not the main concern. (If F is large enough, it can offset any possible donations.)
The real concern is how political contributions affect the choices politicians make once they get into office. While outright quid-pro-quo bribery is illegal, it’s well-known that many corporations and wealthy individuals will give campaign donations with the reasonable expectation of influencing what sort of policies will be made.

You don’t think Goldman Sachs gives millions of dollars each election out of the goodness of their hearts, do you? And they give to both major parties, which really only makes sense if their goal is not to make a particular candidate win, but to make sure that whoever wins feels indebted to Goldman Sachs. (I guess it could also be to prevent third parties from winning—but they hardly ever win anyway, so that wouldn’t be a smart investment from the bank’s perspective.)

Lynda Powell at the University of Rochester has documented the many subtle but significant ways that these donations have influenced policy. Campaign donations aren’t as important as party platforms, but a lot of subtle changes across a wide variety of policies add up to large differences in outcomes.

A political contribution tax would reduce these influences. If politicians’ sole goal were to win, the tax would have no effect. But it seems quite likely that politicians enjoy various personal benefits from lobbying and campaign contributions: Fine dinners, luxurious vacations, and so on. And insofar as that is influencing politicians’ behavior, it is both obviously corrupt and clearly reduced by a political contribution tax. How large an effect this would be is difficult to say; but the direction of the effect is clearly the one we want.

Taxing donations would also allow us to protect the right to give to campaigns (which does seem to be a limited kind of civil liberty, even though the precise interpretation “money is speech” is Orwellian), while reducing corruption and allowing us to keep close track on donations that are made. Taxing a money stream, even a small amount, is often one of the best ways to incentivize close monitoring of that money stream.

With a subtle change, the tax could even be made to bias in favor of populism: All you need to do is exempt small donations from the tax. If say the first $1000 per person per year is exempt from taxation, then the imposition of the tax will reduce the effectiveness of million-dollar contributions from Goldman Sachs and the Koch brothers without having any effect on $50 donations from people like you and me. That would technically be “distorting” elections—but it seems like it might be a distortion worth making.

Of course, this is probably even less likely to happen than the advertising tax.

Influenza vaccination, herd immunity, and the Tragedy of the Commons

Dec 24, JDN 2458112

Usually around this time of year I do a sort of “Christmas special” blog post, something about holidays or gifts. But this year I have a rather different seasonal idea in mind. It’s not just the holiday season; it’s also flu season.

Each year, influenza kills over 56,000 people in the US, and between 300,000 and 600,000 people worldwide, mostly in the winter months. And yet, in any given year, only about 40% of adults and 60% of children get the flu vaccine.

The reason for this should be obvious to any student of economics: It’s a Tragedy of the Commons. If enough people got vaccinated that we attained reliable herd immunity (which would take about 90%), then almost nobody would get influenza, and the death rate would plummet. But for any given individual, the vaccine is actually not all that effective. Your risk of getting the flu only drops by about half if you receive the vaccine. The effectiveness is particularly low among the elderly, who are also at the highest risk for serious complications due to influenza.

Thus, for any given individual, the incentive to get vaccinated isn’t all that strong, even though society as a whole would be much better off if we all got vaccinated. Your probability of suffering serious complications from influenza is quite low, and wouldn’t be reduced all that much if you got the vaccine; so even though flu vaccines aren’t that costly in terms of time, money, discomfort, and inconvenience, the cost is just high enough that a lot of us don’t bother to get the shot each year.

On an individual level, my advice is simple: Go get a flu shot. Don’t do it just for yourself; do it for everyone around you. You are protecting the most vulnerable people in our society.

But if we really want everyone to get vaccinated, we need a policy response. I can think of two policies that might work, which can be broadly called a “stick” and a “carrot”.

The “stick” approach would be to make vaccination mandatory, as it already is for many childhood vaccines. Some sort of penalty would have to be introduced, but that’s not the real challenge. The real challenge would be how to actually enforce that penalty: How do we tell who is vaccinated and who isn’t?

When schools make vaccination mandatory, they require vaccination records for admission. It would be simple enough to add annual flu vaccines to the list of required shots for high schools and colleges (though no doubt the anti-vax crowd would make a ruckus). But can you make vaccination mandatory for work? That seems like a much larger violation of civil liberties. Alternatively, we could require that people submit medical records with their tax returns to avoid a tax penalty—but the privacy violations there are quite substantial as well.

Hence, I would favor the “carrot” approach: Use government subsidies to provide a positive incentive for vaccination. Don’t simply make vaccination free; actually pay people to get vaccinated. Make the subsidy larger than the actual cost of the shots, and require that the doctors and pharmacies administering them remit the extra to the customers. Something like $20 per shot ought to do it; since the cost of the shots is also around $20, then vaccinating the full 300 million people of the United States every year would cost about $12 billion; this is less than the estimated economic cost of influenza, so it would essentially pay for itself.

$20 isn’t a lot of money for most people; but then, like I said, the time and inconvenience of a flu shot aren’t that large either. There have been moderately successful (but expensive) programs incentivizing doctors to perform vaccinations, but that’s stupid; frankly I’m amazed it worked at all. It’s patients who need incentivized. Doctors will give you a flu shot if you ask them. The problem is that most people don’t ask.

Do this, and we could potentially save tens of thousands of lives every year, for essentially zero net cost. And that sounds to me like a Christmas wish worth making.

The Irvine Company needs some serious antitrust enforcement

Dec 17, JDN 2458105

I probably wouldn’t even have known about this issue if I hadn’t ended up living in Irvine.

The wealthiest real estate magnate in the United States is Donald Bren, sole owner of the Irvine Company. His net wealth is estimated at $15 billion, which puts him behind the likes of Jeff Bezos or Bill Gates, but well above Donald Trump even at his most optimistic estimates.

Where did he get all this wealth?

The Irvine Company isn’t even particularly shy about its history, though of course they put a positive spin on it. Right there on their own website they talk about how it used to be a series of ranches farmed by immigrants. Look a bit deeper into their complaints about “squatters” and it becomes apparent that the main reason they were able to get so rich is that the immigrant tenant farmers whose land they owned were disallowed by law from owning real estate. (Not to mention how it was originally taken from Native American tribes, as most of the land in the US was.) Then of course the land has increased in price and been passed down from generation to generation.

This isn’t capitalism. Capitalism requires a competitive market with low barriers of entry and trade in real physical capital—machines, vehicles, factories. The ownership of land by a single family that passes down its title through generations while extracting wealth from tenant farmers who aren’t allowed to own anything has another name. We call it feudalism.

The Irvine Company is privately-held, and thus not required to publish its finances the way a publicly-traded company would be, so I can’t tell you exactly what assets its owns or how much profit it makes. But I can tell you that it owns over 57,000 housing units—and there are only 96,000 housing units in the city of Irvine, so that means they literally own 60% of the city. They don’t just own houses either; they also own most of the commercial districts, parks, and streets.

As a proportion of all the housing in the United States, that isn’t so much. Even compared to Southern California (the most densely populated region in North America), it may not seem all that extravagant. But within the city of Irvine itself, this is getting dangerously close to a monopoly. Housing is expensive all over California, so they can’t be entirely blamed—but is it really that hard to believe that letting one company own 60% of your city is going to increase rents?

This is sort of thing that calls for a bold and unequivocal policy response. The Irvine Company should be forced to subdivide itself into multiple companies—perhaps Irvine Residential, Irvine Commercial, and Irvine Civic—and then those companies should be made publicly-traded, and a majority of their shares immediately distributed to the residents of the city. Unlike most land reform proposals, selecting who gets shares is actually quite straightforward: Anyone who pays rent on an Irvine Company property receives a share.

Land reform has a checkered history to say the least, which is probably why policymakers are reluctant to take this sort of approach. But this is a land reform that could be handled swiftly, by a very simple mechanism, with very clear rules. Moreover, it is entirely within the rule of law, as the Irvine Company is obviously at this point an illegitimate monopoly in violation of the Sherman Antitrust Act, Clayton Antitrust Act, and Federal Trade Commission Act. The Herfindahl-Hirschman Index for real estate in the city of Irvine would be at least 3600, well over the standard threshold of 2500 that FTC guidelines consider prima facie evidence of an antitrust violation in the market. Formally, the land reform could be accomplished by collecting damages in an amount necessary to purchase the shares at the (mandatory) IPO, then the beneficiaries of the damages paid in shares would be the residents of Irvine. The FTC is also empowered to bring criminal charges if necessary.

Oddly, most of the talk about the Irvine Company among residents of Irvine centers around their detailed policy decisions, whether expanding road X was a good idea, how you feel about the fact that they built complex Y. (There’s also a bizarre reverence for the Irvine Master Plan; people speak of it as if it were the US Constitution, when it’s actually more like’s five-year revenue targets. This is a for-profit company. Their plan is about taking your money.) This is rather like debating whether or not you have a good king; even if you do, you’re still a feudal subject. No single individual or corporation should have that kind of power over the population of an entire city. This is not a small city, either; Irvine has about three-quarters of the population of Iceland, or a third the population of Boston. Take half of Donald Bren’s $15 billion, divide it evenly over the 250,000 people of the city, and each one gets $30,000. That’s a conservative estimate of how much monopolistic rent the Irvine Company has extracted from the people of Irvine.

By itself, redistributing the assets of the Irvine Company wouldn’t solve the problem of high rents in Southern California. But I think it would help, and I’m honestly having trouble seeing the downsides. The only people who seem to be harmed are billionaires who inherited wealth that was originally extracted from serfs. Like I said, this is within the law, and wouldn’t require new legislation. We would only need to aggressively enforce laws that have been on the books for a century. It doesn’t even seem like it should be politically unpopular, as you’re basically giving a check for tens of thousands of dollars to each voting resident in the city.

Of course, it won’t happen. As usual, I’m imagining more justice in the world than there actually has ever been.

Why do so many people equate “natural” with “good”?

Dec 3, JDN 2458091

Try searching sometime for “all-natural” products. It doesn’t matter whether you’re looking for dog food, skin cream, clothing, or even furniture polish; you will find some out there that proudly declare themselves “all-natural”. There is a clear sense that there is something good about being natural, some kind of purity that comes from being unsullied by industrial technology. (Of course, when you buy something online that is shipped to you in a box carried on a truck because it’s “all-natural”….)

Food is the most extreme case, where it is by now almost universally agreed that processed food is inherently harmful and the source of all of our dietary problems if not all our social ills.

This is a very strange state of affairs, as there is no particular reason for “natural” and “good” to be in any way related.

First of all, I can clearly come up with examples of all four possible cases: Motherhood is natural and good, but gamma ray bursts are natural and bad. Vaccination is artificial and good, but nuclear weapons are artificial and bad.

Natural Artificial
Good Motherhood Vaccination
Bad Gamma ray bursts Nuclear weapons

But even more than that, it’s difficult to even find a correlation between being natural and being good. If anything, I would expect the correlation to run the other way: Artificial things were created by humans to serve some human purpose, while natural things are simply whatever happens to exist. Most of the harmful artificial things are the result of mistakes, or unintended consequences of otherwise beneficial things—while plenty of harmful natural things are simply inherently harmful and never benefited anyone in any way. Nuclear weapons helped end World War 2. Gamma ray bursts will either hardly affect us at all, or instantly and completely annihilate our entire civilization. I guess they might also lead to some valuable discoveries in astrophysics, but if I were asked to fund a research project with the same risk-reward profile as a gamma ray burst, I would tear up the application and make sure no one else ever saw it again. The kind of irrational panic people had about the possibility of LHC black holes would be a rational panic if applied to a research project with some risk of causing gamma ray bursts.

The current obsession with “natural” products (which is really an oxymoron, if you think about it; it can’t be natural if it’s a product) seems to have arisen as its own unintended consequence of something good, namely the environmentalist movement in the 1960s and 1970s. The very real problems of pollution, natural resource depletion, extinction, global warming, desertification, and ocean acidification led people to rightly ask how the very same industrial processes that brought us our high standard of living could ultimately destroy it if we left them unchecked.

But the best solutions to these problems are themselves artificial: Solar power, nuclear energy, carbon taxes. Trying to go back to some ancient way of life where we didn’t destroy the environment is simply not a viable option at this point; even if such a way of life once existed, there’s no way it could sustain our current population, much less our current standard of living. And given the strong correlation between human migrations and extinction events of large mammals, I’m not convinced that such a way of life ever existed.

So-called “processed food” is really just industrially processed food—which is to say, food processed by the most efficient and productive technologies available. Humans have been processing food for thousands of years, and with very good reason; much of what we eat would be toxic if it weren’t threshed or boiled or fermented. The fact that there are people who complain about “processed food” but eat tofu and cheese is truly quite remarkable—think for a moment about how little resemblance Cheddar bears to the cow from whence it came, or what ingenuity it must have taken people in ancient China to go all the way from soybean to silken tofu. Similarly, anyone who is frightened by “genetically modified organisms” should give some serious thought to what is involved in creating their seedless bananas.

There may be some kernel of truth in the opposition to industrially processed food, however. The problem is not that we process food, nor that we do so by industrial machines. The problem is who processes the food, and why.

Humans have been processing food for thousands of years, yes; but only for the last few hundred have corporations been doing that processing. For most of human history, you processed food to feed your family, or your village, or perhaps to trade with a few neighboring villages or sell to the nearest city. What makes tofu different from, say, Fruit Loops isn’t that the former is less processed; it’s that the latter was designed and manufactured for profit.

Don’t get me wrong; corporations have made many valuable contributions to our society, including our food production, and it is largely their doing that food is now so cheap and plentiful that we could easily feed the entire world’s population. It’s just that, well, it’s also largely their doing that we don’t feed the entire world’s population, because they see no profit in doing so.

The incentives that a peasant village faces in producing its food are pretty well optimized for making the most nutritious food available with the least cost in labor and resources. When your own children and those of your friends and neighbors are going to be eating what you make, you work pretty hard to make sure that the food you make is good for them. And you don’t want to pollute the surrounding water or destroy the forest, because your village depends upon those things too.

The incentives that a corporation faces in producing food are wildly different. Nobody you know is going to be eating this stuff, most likely, and certainly not as their primary diet. You aren’t concerned about nutrition unless you think your customers are; more likely, you expect them to care about taste, so you optimize your designs to make things taste as good as possible regardless of their nutrition. You care about minimizing labor inputs only insofar as they cost you wages—from your perspective, cutting wages is as good as actually saving labor. You want to conserve only the resources that are expensive; resources that are cheap, like water and (with subsidies) corn syrup, you may as well use as much as you like. And above all, you couldn’t care less about the environmental damage you’re causing by your production, because those costs will be borne entirely by someone else, most likely the government or the citizens of whatever country you’re producing in.

Responsible consumers could reduce these effects, but only somewhat, because there is a fundamental asymmetry of information. The corporation “knows” (in that each of the administrators in each of the components that needs to know, knows) what production processes they are using and what subcontractors they are hiring, and could easily figure out how much they are exploiting workers and damaging the environment; but the consumers who care about these things can find out that information with great difficulty, if at all. Consumers who want to be responsible, but don’t have very good information, create incentives for so-called “greenwashing”: Corporations have many good profit-making reasons to say they are environmentally responsible, but far fewer reasons to actually be environmentally responsible.

And that is why you should be skeptical of “all-natural” products, especially if you are skeptical of the role of corporations in our society and our food system. “All-natural” is an adjective that has no legal meaning. The word “organic” can have a legally-defined meaning, if coupled with a certification like the USDA Organic standard. The word “non-toxic” has a legally-defined meaning—there is a long list of toxic compounds it can’t contain in more than trace amounts. There are now certifications for “carbon-neutral”. But “all-natural” offers no such protection. Basically anything can call itself “all-natural”, and if corporations expect you to be willing to pay more for such products, they have no reason not to slap it on everything. This is a problem that I think can only be solved by stringent regulation. Consumer pressure can’t work if there is no transparency in the production chain.

Even taken as something like its common meaning, “not synthetic or artificial”, there’s no reason to think that simply because something is natural, that means it is better, or even more ecologically sustainable. The ecological benefits of ancient methods of production come from the incentives of small-scale local production, not from something inherently more destructive about high-tech industry. (Indeed, water pollution was considerably worse from Medieval peasant villages—especially on a per-capita basis—than it is from modern water treatment systems.)