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Incentive vs. Coercion

Publius at Obsidian Wings outlines his argument against allowing kidney sales. It's one just about every libertarian has encountered, and been utterly bewildered by, before:

Here's an example. Let's say Wal-Mart decides to start offering people $5,000 per finger. (Let's assume scientists have found a chemical in finger bones that helps break unions). Under the liberal view, everyone is "free" to take that offer or to decline it.

But this "freedom" isn't all it's cracked up to be. From an opportunity cost perspective, Wal-Mart's offer exerts more force on someone with a salary of $25,000, than it does on someone who makes $100,000. The former is essentially throwing away 20% of their yearly salary, while the latter is throwing away 5%. Both individuals are "free" - but the lower income makes the offer harder to refuse for the $25K person. It exerts more force on that person. To say, then, that these two people are both "free" misses an important difference between them.

The problem with this argument is twofold: First, it relies on a deeply flawed conception of what coercion is. If Wal-Mart were to go around making people poor and then offering to buy their fingers for $5,000 apiece, that would be coercive. But Wal-Mart doesn't make people poor*. They'd be poor with or without Wal-Mart and its funds-for-fingers offer.

So to say that Wal-Mart's hypothetical offer exerts more "force" on the poor is true only in a very broad sense of the word "force"—i.e., one that includes force of persuasion. The poor aren't having their options limited by Wal-Mart; they're having their options limited by being poor. By offering to buy their fingers, Wal-Mart expands their options.

Which leads to the second problem with this argument: It can be accurately summarized as follows:

Premise: It's terrible that some people are so poor that they might decide that selling a kidney is their best option.

Conclusion: Therefore we must make sure that they don't have that option.

The premise is tenable, but the conclusion—that we should make the bad situation the poor are in even worse by cutting off what they consider to be their best option—is absurd. A somewhat less insane conclusion to draw from the premise is that we should find some way to raise the standard of living of the poor so that selling a kidney becomes a less attractive option**.

The fact that we have not done this yet*** is not a legitimate reason to support a ban on kidney sales. The two issues are entirely independent of one another. If the poor are to remain at their current standard of living, they're made better off by being given the option to sell their kidneys. If we do find some way to mitigate poverty further than we already have, the poor are still made better off by being given that option. And it's very unlikely that legalizing kidney sales will prevent further attempts at poverty mitigation.

Really, there's only one tenable argument against legalizing kidney sales, and that is that the poor are, by virtue of their lower intelligence, simply not competent to decide whether or not to sell a kidney. While I certainly do acknowledge that the poor are, on average, quite a bit less intelligent than the middle and upper classes, I'm just not comfortable with that level of paternalism except in truly pathological cases. And I don't think there are many leftists who want to go down the road of deciding what rights should be denied to people with low IQs. Nevertheless, I will grant that this argument is at least logically coherent.

It's worth noting that this refutation applies to all arguments that take the form of "It's coercive to offer the poor money to do X."

Via Ampersand.

*Yes, I'm aware that many leftists believe that Wal-Mart does just this, but they're too far gone to bother with.

**Actually, since most people put a very high value on not dying, this would most likely just result in an increase in the market price of kidneys, and the kidneys would still come from disproportionately from the poorest among us. But I'm assuming that there's some absolute standard of living high enough that most left-wing opponents of kidney sales would drop this particular objection.

***In fact, we have a truly excellent poverty mitigation program which has increased the poor's standard of living severalfold in the last century, and several others which have increased it moderately beyond that. (I am of course referring to capitalism and to various government welfare programs, respectively.) What I mean is that we haven't mitigated poverty enough for people to stop making this argument.


The Jimmie Lunceford Model of Democracy

I have a conjecture about democracy: The truth-value of the claims a politician makes have at most a very slight effect on his chances of getting elected. A politician can stand up on a podium and tell blatant lies, and these lies can be debunked conclusively, yet he will suffer no negative consequences. What matters is that the politician tell the lies confidently and convincingly.

I think that this works because the median voter is simply not equipped to assess the truth-value of a politician's claims, so his vote comes down to a combination of esthetic factors and social proof (these dominate among the party loyalists), and perception of one politician as more likeable or trustworthy than the other (this dominates among swing voters). For the vast majority of voters, style trumps substance.

I'm not 100% sure of this, but it would explain a lot. Can anyone think of any counterexamples? Has a politician ever been caught in a lie (about policy, not sex), refused to acknowledge it or show contrition, and paid an electoral price for it?

Also for consideration: Can a politician beat a sex scandal by immediately coming out and saying, "Yeah, I slept with her, and her sister, too, and it was good. Any other questions?" That is, is it the display of contrition (and thus weakness) that hurts them more than the actual scandal?

Reference here.


This Is the Best You Could Do?

I think that widespread overestimation of the role racism plays in the US is a serious problem, and this is something that I write about a lot. I'd say that about 80% of the times I look into an allegation of racism, the evidence available to me suggests that it's seriously overblown or totally unfounded. But every once in a while, I run into something that makes me want to drop everything and get on a plane so that I can hand-deliver a much-deserved smackdown to some racist idiot for doing something that makes all those bogus allegations just a bit more credible. For example:

Seriously, what the hell? The Obama administration is shaping up to be the worst disaster to hit this country since LBJ, or maybe even Roosevelt, and the best the creator of this picture could come up with is, "Ha ha! He's black!"?

Defining somebody primarily in terms of his race is racism in the most fundamental sense of the word, and implying that the mere fact that he's black makes him worthy of mockery just isn't right.

And impolitic to boot. I hope Jesse Jackson and Al Sharpton went in together on a gift basket for Sherri Goforth, because it's people like her who make their racket possible.

Via Jeff Fecke.


Taxation and Greed

Leftists are fond of asserting that those who oppose their tax-and-spend agenda are motivated by greed. Let's put aside for now the question of whether it's "greedy" to object to having the fruits of your labor forcibly confiscated. The biggest problem with this assertion is that it's flat-out illogical.

The only proposals really on the table nowadays with respect to tax hikes are to raise taxes on a fairly small number of high-earning taxpayers. Let's say those in the top 5%, though it's probably an even smaller percentage than that. Really, when was the last time you heard calls for the middle class to start paying their fair share? What this means is that 95% of people will be the ostensible* beneficiaries of tax increases, with 5% bearing the cost.

So for the vast majority of people, opposing a tax-and-spend agenda means turning down the opportunity to enrich themselves at their richer countrymen's expense. Conversely, supporting a tax-and-spend agenda amounts to reaching into someone else's pocket and grabbing a handful of cash.

The logic of this assertion—again, setting aside the dubious moral judgments—applies at best only to the small minority with incomes high enough to be hit directly by the proposed tax increases. For the rest of us, it's completely backwards: The greedy thing to do is to support tax and spending hikes, and the magnanimous** thing to do is to oppose them.

*I say ostensible because increased government spending makes us all poorer in the long run.

**Relatively speaking, anyway. Simple refraining from unilaterally deciding to grab someone else's money is a pretty low bar.


On Empathy

I may or may not have posted this as a comment over at Essentially Contested America in response to this post:

Senator Minority lead Jeff Sessions made the astounding remark on Face the Nation Sunday that when a judge shows empathy toward one litigator, it means he or she will show bias toward the other litigant. What can this possibly mean?

Taken literally, Sessions' claim is correct: If you empathize with exactly one side, it biases you against the other. This is an important point to remember, because for most people it's easier to empathize with one side than with the other. For example, in a conflict between an individual and a corporation, juries often find it easier to empathize with the individual than with the shareholders of the corporation (especially with them not being present in the courtroom), with the result being a bias against the corporation.

Another example: leftists tend to empathize more with the recipients of government transfer payments than with the taxpayers who fund them. Now, it's one thing to carefully deliberate the interests of each side and come to the conclusion that, on net, less harm is done overall by redistribution than by a more laissez-faire approach. What I actually see from most leftists, though, is either "Screw you, you don't matter" or mockery of the idea that someone making $200,000 per year might be negatively impacted by having more than half his income confiscated by the government--in short, explicit refusal to empathize with one side. In cases like this, "empathy" is little more than a euphemism for bias. In fact, this seems to me to be the case more often than not.

I'm not intimately familiar with Sotomayor's record, but I do think it's important to ask whether her fabled empathy is something she's in the habit of applying in an even-handed manner, or just rhetorical cover to rule in a way that advances a left-wing agenda.

Update: Constant has more here.


Antioxidants Considered Harmful

Dennis Mangan has recently blogged on a couple of studies (here and here) suggesting that antioxidant supplementation essentially nullifies many of the health benefits associated with exercise.

Any number of caveats apply—these are short-term studies, only a couple of antioxidants were considered, not all possible health effects were measured, the findings may or may not apply to antioxidant-rich foods, etc.—but I think there's enough in here to give those of us who do take antioxidant supplements some cause for concern.

Edit: The reason for this, as I understand it, is that free radicals play a critical role in the physiological changes caused by exercise. When antioxidants neutralize the free radicals, those physiological changes are never triggered.


Classical Feminism

I've always believed that classical feminism was different from modern feminism, in that classical feminists were fighting against genuine violations of women's rights, whereas modern feminism consists primarily of overhyping sexism and trying to secure new legal privileges for women. I stand corrected:

On Mount Cyllene in the Peloponnese, as Tiresias came upon a pair of copulating snakes, he hit the pair a smart blow with his stick. Hera was not pleased, and she punished Tiresias by transforming him into a woman....After seven years as a woman, Tiresias again found mating snakes; depending on the myth, either she made sure to leave the snakes alone this time, or, according to Hyginus, trampled on them. As a result, Tiresias was released from his sentence and permitted to regain his masculinity....

In a separate episode, Tiresias was drawn into an argument between Hera and her husband Zeus, on the theme of who has more pleasure in sex: the man, as Hera claimed; or, as Zeus claimed, the woman, as Tiresias had experienced both. Tiresias replied "Of ten parts a man enjoys one only." Hera instantly struck him blind for his impiety.

Treating as axiomatic the idea that women get the short end of every stick (no pun intended)? Check. Refusal to accept evidence contradicting her preconceived notions? Check. Flying into a blind rage at someone who dares to disagree with her? Check. It turns out that "modern" feminism goes back a lot further than I ever suspected.


Your Patriotic Duty

I hoped it wouldn't come to this, but in light of recent events, I think it's time:

1. Choose a politician who has made transparently idiotic promises to create jobs.
2. On one side of a piece of paper, print Bastiat's Parable of the Broken Window. On the other side, reproduce documentation of the politician's commission of this fallacy.
3. Tie this piece of paper to a brick and throw it through the politician's window.


IQ: The Map Is Not the Territory

I often see people assert that intelligence is normally distributed. This may or may not be true, but the evidence that people generally cite to support this claim—that IQ is normally distributed—is completely irrelevant. IQ is forced into a normal distribution because it's defined that way; this tells us nothing at all about the shape of the underlying intelligence distribution.

Before I elaborate, let me make it clear that the point I'm making is completely independent of the following questions:

  • Whether the idea of a scalar measure of intelligence is even theoretically coherent.
  • Whether it's possible to design tests that mesaure this.
  • Whether the IQ tests currently in use actually measure this.

Assume for the sake of argument that all of these propositions are true. Now here's how IQ tests work: A test measuring a wide variety of cognitive skills is given to many people. Each person gets a raw score, which is essentially the number of questions he answered correctly*. IQ scores are then assigned based on each person's percentile within the raw score distribution (for his age group). The mapping from raw score to IQ is roughly as follows:

Percentile IQ
1% 65
5% 75
10% 81
25% 90
50% 100
75% 110
90% 119
95% 125
99% 135

A more complete table is available here.

In the process of conversion, all information about the underlying distribution of raw scores is lost. The distribution of raw scores may be normal, but it could just as easily be bimodal, log-normal, or any kind of distribution at all. As long as there aren't too many people with exactly the same raw score, any distribution can be transformed into normally distributed IQ scores.

Now consider three people with IQs of 75, 100, and 125—call them Al, Bob, and Chris, respectively. What we can say about their intelligence is that Chris is smarter than Bob, and Bob is smarter than Al, but we can't say anything about how much smarter anyone is than anyone else. The difference in intelligence between Al and Bob is not necessarily equal to the difference between Bob and Chris, even though the difference in IQ is.

So why is it done this way, instead of reporting the raw scores directly? I believe it's because some or all of the assumptions above are incorrect. If Bob gets significantly more questions right than Al does, then we can say with a reasonable degree of confidence that Bob is smarter than Al, but we really can't say how much smarter. The difference in raw scores is highly sensitive to the difficulty of the questions, and we don't know how hard to make the questions to produce a true cardinal metric of intelligence.

In fact, I'm not even sure the first assumption is true. I really can't think of a meaningful interpretation of the sentence "Chris is twice as smart as Al", or even "Chris is as much smarter than Bob as Bob is than Al."

Of course, that's all academic. The important point to take away is that even though IQ may look like a cardinal value, it's really just a tarted up percentile ranking. Why we don't just use percentiles instead of IQ scores, I really don't know. I would think it would make things much clearer, but I guess the IQ scale does make it easier to talk about extreme outliers.

*Test designers may make some questions worth more than one point in order to weight them more heavily, but that's not important here.


On "Free-Market Miracles"

It's common to hear the rapid growth of economies like Singapore and Hong Kong referred to as "free-market miracles." I have a quibble with this characterization. A miracle is a phenomenon which implies divine intervention due to its inconsistency with the laws of nature as we understand them. But not only is rising prosperity following liberalization consistent with the laws of nature and economics, but it's precisely what those laws tell us to expect. The success of Hong Kong and Singapore aren't miracles at all, but entirely mundane.

Now, if an economy were to prosper as a result of socialization, it would be appropriate to call it a socialist miracle. But miracles don't really happen.


Links

Bryan Caplan on Lee Kuan Yew on the differences between Singapore and Hong Kong. Caplan's analysis sounds about right to me; while a bad dictator can be disastrous, a good dictator can enact much better economic policy than any democratic government ever would.

Minority Elected President—Minorities Hit Hardest. A silver lining to the otherwise disastrous election of Obama.


From the Archives

If you have 25 minutes free, check out this anti-communist episode of Alfred Hitchcock Presents.


How to Control Entitlement Spending

The government is having some trouble figuring out how best to control the growth of entitlement spending. I have the answer.

For millennia, responsible adults in the private sector have jealously guarded the secret of an ancient accounting technique called "budgeting." In 1804, J. Thomas Bagwell, who ran a small textile mill in Bristol, threatened to reveal this secret to the government. The night before he set out for London, his home and mill were burned to the ground, with him and his entire family inside. His name was purged from all official records. He is now forgotten in all but the inner circles of the private sector, and his story remembered only in the form of whispered warnings of the fate awaiting anyone who dares to reveal their secrets.

So I bring you this information at no small risk to myself. But this is knowledge that the world desperately needs, and it's a risk I'm willing to take.

The way government currently does entitlement spending is to decide what it wants, and then beg, borrow, and steal* as needed to pay for it. This is backwards. Using budgeting, what we do is first figure out how much money we have, and then decide how to spend it. For example, if you decide you can afford to spend 5% of GDP on Social Security, and your payout schedule has you spending 6%, you reduce the payout ratio, raise the retirement age, impose means testing, or find some other way to stay within the budget.

Sometimes you might want to spend more than you have. That's a perfectly normal desire. The way responsible adults in the private sector handle this desire is simply to acknowledge that you can't have everything you want, and live with it. While this may sound strange at first, it's a technique that's served us well for millennia.

Another example: Suppose you can afford to spend 4% of GDP on Medicare, but under your current policies you're spending 5%. As with Social Security, increasing the age of eligibility or imposing means testing is one way. You can also cover fewer expensive treatments and on-patent drugs, increase premiums, or reimburse less (insofar as you can do this without losing too many doctors). It's that simple.

The cast of Saturday Night Live fields questions. I expect to see them taken off the air any day now, assuming I live long enough myself.

*Literally!


Update: It probably goes without saying, but of course I do realize that not everyone in the private sector budgets responsibly, especially not in the last few years. But responsible budgeting does dominate in the private sector, as evidenced by the fact that net private savings have been positive every year for the last 50, while net public savings have been negative for 34 of the last 50 years. See table B-32 here for details.


Recycling: Unenlightening Units of Measure

Megan McArdle quotes this from Wiredog, which is supposed to help me understand how much a trillion dollars is:

A couple years ago someone asked me, as an aid to visualizing the budget, how many transport flights it would take to move $1T worth of $100 bills.

So $1T is 10B $100 bills.

10B grams is 10M kg

120,000 kg is the capacity of the C5 Galaxy aircraft. So it would take 84 flights to move $1T in $100 bills.

Another analogy involving days since the birth of Jesus follows. My response:

These analogies don't seem very useful to me. 84 planeloads of $100 bills is totally meaningless to me as a measure of value. It's much more meaningful to say that a trillion dollars is $3,300 for every man, woman, and child in the US, or roughly twice that much for every labor force participant. Or that it's 7 cents out of every dollar's worth of goods and services produced in this country.

Knowing that the government took 40 cents out of every dollar I earned last year enrages me a lot more than some contrived story about airplanes ferrying pallets of $100 bills around.


Capitalism and Tolerance

Back in 2000, when I started my first real job, I noticed when signing up for benefits that my employer offered benefits for same-sex domestic partners equivalent to those offered to spouses. At the time the significance escaped me, but in retrospect I see this as a testament to the power of the profit motive to foster tolerance. At a time when voters in the most left-leaning states in the country were unwilling to vote in favor of legal recognition of same-sex marriages, a major corporation did so because that's what it had to do to attract talented gay engineers. In this, as in most everything, it was money-grubbing capitalists, not voters, who were on the cutting edge of tolerance.

On a similar note, about twenty years ago, I remember hearing my grandmother describing her response to a customer who'd badmouthed a lesbian couple who frequented the bar my parents and grandparents co-owned: "Their money's as good as yours." A cliché, yes, but an uplifting one. It reminds us that the merchant pays a price for intolerance.

It's easy to indulge one's petty prejudices in the voting booth, where the price for doing so is negligible. But every time a merchant turns away a customer, every time an employer turns away a candidate or loses him to a more tolerant competitor, he's reminded of what his bigotry is costing him.

If I were a member of an unpopular minority*, I'd want as many decisions about my civil rights in the hands of money-grubbing capitalists as possible. There is no political equivalent of "their money's as good as yours," and some things are just too important to be left up to the political process.

*Actually, as an atheist, I guess I am.