Coyote Blog

Last night, Van Jones (among likely many others on the Progressive Left) lamented, "How am I going to explain the election [Trump's victory] to my kids?"

Well, as someone who has always respected the Constitution, I would tell my kids that the folks who wrote the Constitution spent a lot of time thinking about how to make the system robust against tyrants.  Their solution was a system of checks and balances that prevented a single person in the Presidency acting against the general wishes of the country.  The President is bound both by Congress and the judiciary, but also by law (particularly restrictions in the Bill of Rights).

The last couple of Presidents, with the aid of a sometimes supine Congress and judiciary, have pushed the boundaries of these limitations, expanding Presidential power, and in certain spheres attempted to rule by decree.  Folks like Van Jones were way up in the forefront of folks cheering on this power grab, at least under President Obama, as long as it was their guy grabbing for power.  What should Jones tell his kids?  Perhaps he could say that for well-intentioned reasons, he helped increase the power of the President, but in doing so forgot that folks he disagrees with would likely someday inherit that power.

As I wrote years and years ago:

• Technocratic idealists ALWAYS lose control of the game.  It may feel good at first when the trains start running on time, but the technocrats are soon swept away by the thugs, and the patina of idealism is swept away, and only fascism is left.  Interestingly, the technocrats always cry "our only mistake was letting those other guys take control".  No, the mistake was accepting the right to use force on another man.  Everything after that was inevitable.

Sarah Baker has some nice thoughts along these lines at the Liberty Papers, but I will leave you with her first one:

This is how libertarians feel after every election. We learn to live with it. So will you.

The history of this blog has been, except for the last three months, one of me never ever making political prognostications.  This is a policy I will return to, as I was completely wrong about this election.  Just to rub my own nose in it, this is what I wrote:

I think that "shackled to a suicide bomber" is more apt. Trump is not only going to lose big in this election to an incredibly weak Democratic candidate, but he is also going to kill the Republicans in the House and Senate and any number of down-ballot elections.

Oops.  At this point the election is not decided but Trump is clearly competitive and the Republicans look likely to hold on to both houses of Congress.

In business school, there is a famous project we do in marketing that teaches an important lesson.  In that project, a bunch of Ivy Leaguers are asked to estimate the percentage of people in the US who snow ski.  We all look around the table and say, "I ski and you ski and she skis, so it must be about 80%", when in fact the percentage is in the single digits.  The lesson is to not make predictions for whole markets (and countries) based on one's own personal outlook and experience.  I and many other clearly did not understand large swathes of the electorate, something I want to think about for a bit.   The one thing I am sure about is that my (and many others') attempt to apply a policy framework to this is simply not going to work.  Trump is a sort of anti-wonk, a governmental Loki. Policy choices likely don't explain this election.

Apparently Snuggles is concerned with the mass migration of chihuahuas into this country.

As an aside, I find the mindless selection of candidates based on which one seems to be offering the best treat to be an apt metaphor for modern American democracy.

When some sort of "bad" phenomenon is experiencing a random peak, stories about this peak flood the media.  When the same "bad" phenomenon has an extraordinarily quiet year, there are no stories in the media.  This (mostly) innocuous media habit (based on their incentives) creates the impression among average folks that the "bad" phenomenon is on the rise, even when there is no such trend.

Case in point: tornadoes.  How many stories have you seen this year about what may well be a record low year for US tornadoes?

Extreme lack of extreme with tornadoes. Will need "second season" to stop it from being quietest year on record! pic.twitter.com/PuBvgjJBvn

— Joe Bastardi (@BigJoeBastardi) November 8, 2016

Postscript: By the way, some may see the "inflation-adjusted" term in the heading of the chart and think that is a joke, but there is a real adjustment required. Today we have doppler radar and storm chasers and all sorts of other tornado detection tools that did not exist in, say, 1950. So tornado counts in 1950 are known to understate actual counts we would get today and thus can't be compared directly. Since we did not miss many of the larger tornadoes in 1950, we can adjust the smaller numbers based on the larger numbers. This is a well-known effect and an absolutely necessary adjustment, though Al Gore managed to completely fail to do so when he discussed tornadoes in An Inconvenient Truth. Which is why the movie got the Peace prize, not a science prize, from the crazy folks in Oslo.

If you know anyone in the Phoenix area who might be interested, have them apply.  Please do not apply by putting something in the comments section.

Phoenix digital marketing specialist for campground company

Update:  fixed the link

Coming out of voting today, I met two different couples who I know who both said the same thing to me:  "we cancelled each other out".  Meaning, I think, that the husband and wife voted differently in key elections.  I know this is also true of my wife and I.  Which leads me to wonder if there is a generational difference in toleration for spouses with different political views, or if (as is often the case) nothing is really changing on this and the examples given in the media of intolerant millennials who won't socialize with people who don't pass various political litmus tests are just that, isolated examples.

Speaking of which, I took my daughter to vote for the first time today.  She was pretty excited, and planned her outfit in advance.

She asked me why I was not wearing my "I voted" sticker.  I told her that it made me feel like a sucker.  She told me that she had clearly come to vote her first time with the wrong person, and should have found a doe-eyed idealist.

This is the fourth presidential election since I started blogging.  Never thought I would hold out this long.

This is a good video about various voting mechanisms for handling voting between more than 2 choices.

VotingParadoxes from Paul stepahin on Vimeo.  Via Alex Tabarrok

The video is about voting, but to make things simple it discusses voting among people for a single ice cream flavor they all have to share.   I don't think this video was meant to have any broader application beyond just highlighting basic paradoxes and strategies well-known in voting theory.   To me, though, this video highlights the strong advantages of capitalism over socialism in at least three ways

1. Forcing one-size-fits-all socialist and authoritarian solutions sucks vs. allowing individuals to make choices based on their personal preferences regardless of other preferences in the group.  While the video discusses a variety of voting approaches for forcing everyone into a single choice, all of these result in a lot of folks who don't get their first preference.  Obamacare is a great example, where product features have been standardized, essentially through a voting process (though indirectly) and huge numbers of people are unhappy.
2. The video fails to discuss one shortcoming of simple yes/no voting, and that is degree of preference.  In the real world, we both may prefer vanilla over chocolate, but your preference might be pretty close whereas I might be so allergic to chocolate that eating it will kill me.  Socialist and authoritarian approaches don't have a solution for this, but market capitalism does, as prices signal not only our preference but our degree of preference as well.  The real market for ice cream is a preference expression process orders of magnitude more sophisticated than voting.
3. It is almost impossible for even an autocrat who legitimately wants to maximize well-being to do so, because the mass of individual preferences are impossible to encompass in any one mind.  Towards the end of the video, it became harder and harder for a person to synthesize a best approach from the preference data, and this was just for 10 people.  Imagine 300 million preferences.

I have written before that many universities have focused on creating true diversity of skin pigments and reproductive plumbing among their students but in their primary world of ideas, have created an intellectual monoculture.  If you don't believe it, check out this quote from a Yale dean in the Yale Daily News.

Despite ongoing campus discussions about free speech, Yale remains deeply unwelcoming to students with conservative political beliefs, according to a News survey distributed earlier this month.

Nearly 75 percent of 2,054 respondents who completed the survey — representing views across the political spectrum — said they believe Yale does not provide a welcoming environment for conservative students to share their opinions on political issues. Among the 11.86 percent of respondents who described themselves as either “conservative” or “very conservative,” the numbers are even starker: Nearly 95 percent said the Yale community does not welcome their opinions. About two-thirds of respondents who described themselves as “liberal” or “very liberal” said Yale is not welcoming to conservative students.

...

By contrast, more than 98 percent of respondents said Yale is welcoming to students with liberal beliefs. And among students who described themselves as “liberal” or “very liberal,” 85 percent said they are “comfortable” or “very comfortable” sharing their political views in campus discussions.

In an interview with the News, Yale College Dean Jonathan Holloway said the results of the survey were lamentable but unsurprising. Holloway attributed conservative students’ discomfort at sharing their views partly to the pervasiveness of social media.

“So much of your generation’s world is managed through smart phones. There’s no margin anymore for saying something stupid,” Holloway said. “People have been saying dumb things forever, but when I was your age word of mouth would take a while. Now it’s instantaneous, now context is stripped away.”

So the reason Conservatives have a problem at Yale, according to the Yale administration, is that Yale people don't tolerate folks who are stupid.  LOL.  The Dean later tried to back away from this statement, arguing that he did not mean Conservatives said stupid things, but his comments don't make any sense in any other context.

The institution is certainly hurt by this sort of narrow-mindedness.  It is more of a mixed bag for students.  While Conservatives are certainly frustrated they are frequently not allowed to bring speakers from their side of political issues to campus, there is potentially a silver lining.  As I wrote previously in my letter to Princeton:

I suppose I should confess that this has one silver lining for my family. My son just graduated Amherst College, and as a libertarian he never had a professor who held similar views. This means that he was constantly challenged to defend his positions with faculty and students who at a minimum disagreed, and in certain cases considered him to be a pariah. In my mind, he likely got a better education than left-leaning kids who today can sail through 16 years of education without ever encountering a contrary point of view. Ironically, it is kids on the Left who are being let down the most, raised intellectually as the equivalent of gazelles in a petting zoo rather than wild on the Serengeti,.

From the WSJ:

Americans are leaving the costliest metro areas for more affordable parts of the country at a faster rate than they are being replaced, according to an analysis of census data, reflecting the impact of housing costs on domestic migration patterns.

Those mostly likely to move from expensive to inexpensive metro areas were at the lower end of the income scale, under the age of 40 and without a bachelor’s degree, the analysis by home-tracker Trulia found.

Looking at census migration patterns across the U.S. from 2010 to 2014, Trulia analyzed movement between the 10 most expensive metro areas—including all of coastal California, New York City and Miami—and the next 90 priciest metro areas, based on the percentage of income needed to pay a monthly mortgage on a typical home.

I can't tell you now many people I know here in Arizona that tell horror stories about California and how they had to get out, and then, almost in the same breath, complain that the only problem with Arizona is that it does not have all the laws in place that made California unlivable in the first place.  The will say, for example, they left California for Arizona because homes here are so much more affordable, and then complain that Phoenix doesn't have tight enough zoning, or has no open space requirements, or has no affordability set-asides, or whatever.  I am amazed by how many otherwise smart people cannot make connections between policy choices and outcomes, preferring instead to judge regulatory decisions solely on their stated intentions, rather than their actual effects.

Christopher L. Eisgruber
1 Nassau Hall
Princeton University
Princeton, NJ 08544

Mr. Eisgruber:

The other day I received a call from a Princeton student calling to encourage me to participate in annual giving this year. I was in a hurry, and I feel bad that I gave the student a rushed answer, but I told him that I thought universities were lost and that I no longer had any desire to donate money to any of them. The word “lost” is admittedly imprecise, but it was the best I could to summarize my concerns in a brief call.

When I was at Princeton, we used to laugh at those crotchety alumni who wrote angry letters about Princeton letting in women, or integrating the all-male eating clubs, or whatever else. I never imagined that someday I would find myself writing one of those “I can't donate to Princeton any more” letters, yet here I am doing just that.

Continue reading ‘Why I Don't Donate To My University Anymore -- A Recent Letter to Princeton President Christopher L. Eisgruber’ »

A few months ago I helped my son shop for an apartment in San Diego, where he is working for Ballast Point Beer.  Currently I am helping my daughter look for apartments in Pasadena, where she may be attending art school.  In both cases we found that small studio apartments often have higher rents than one- and sometimes even two-bedroom apartments in the same complex (and with the same fit and finish, amenities, etc.)

What the hell?  I understand that there may be more demand for studio apartments in these neighborhoods among young singles than for larger apartments, but once one sees the studio for $2200 and the one-bedroom for $1800, why would one still choose the studio, which might be half the size?   Ease of cleaning?  Is there some artificial demand from some government or financial aid program that will only pay for studio apartments?  Do Chinese students come to the US and suddenly get agoraphobia from an apartment that is too large?

Via Engadget:

Uber drivers have won an employment tribunal case in the UK, making them entitled to holiday pay, paid rest breaks and the National Minimum Wage. The ride-hailing company has long argued that its chauffeurs are self-employed contractors, not employees; the tribunal disagreed, however, setting a major precedent for the company and its relationship with workers. GMB, the union for professional drivers in the UK, initiated the two "test cases" in July. It's described the decision as a "monumental victory" that will impact "over 30,000 drivers" in England and Wales.

"Uber drivers and thousands of others caught in the bogus self-employment trap will now enjoy the same rights as employees," Maria Ludkin, GMB's legal director said. "This outcome will be good for passengers too. Properly rewarded drivers are the same side of the coin as drivers who are properly licensed and driving well maintained and insured vehicles."

My daughter and I had a lot of fun putting this together.  The back side is a sort of playhouse, with lots of little references to various Disney animated movies.

Sheriff Joe Arpaio is way behind in the polls.

Apparently a chunk of what looks like manufactured aluminum was dug up years ago in Romania and was dated at up to 250,000 years old.  By this dating -- given the technology required to make aluminum -- it would be unlikely to be man-made.

So of course everyone is focusing on the question of whether it is an alien artifact.  Which is the wrong question.  A rational person should be asking, "what is it about this particular metallurgy or the way in which it was buried that is fooling our tests into thinking that a relatively new object is actually hundreds of thousands of years old?"  I would need to see folks struggle unsuccessfully with this question for quite a while before I would ever use the word "alien."  I am particularly suspicious of tests that have an error bar running between 400 years and 250,000 years.  That kind of error range is really close to saying "we have no idea."

Postscript:  The article hypothesizes that it looks like an axe head.  Right.  Aliens find some way to fly across light-years, defying much of what we understand about physics, and then walk out of their unimaginably advanced spacecraft carrying an axe to chop some wood, when the head immediately goes flying off the handle and has to be left behind as trash.

From an interview of Political scientist Steven Teles by Megan McArdle:

In political science we often model political actors as having fixed interests and positions, and then we try to figure out how they do or don't get their way. But there's actually more play in the joints of politics than that. Some people -- like Ronald Reagan! -- just switch teams entirely. More broadly, as we address in the book, entire parties switch their positions. If we want to understand politics, we need some way of understanding that process.

As I grow older, and have had more time to observe, I find the shifts in party positions fascinating and oddly opaque to most folks who are in the middle of them - perhaps this is one advantage to being part of neither major party.   Some of the shifts are generational -- for example both parties have moved left on things like homosexuality and narcotics legalization.   Some of the shifts have to do with who controls the White House -- the party in power tends to support executive power and military interventionism, while the opposition tends to oppose these things.   Some of the shifts have to do with who controls intellectual institutions like college in the media -- the group in control of these institutions tends to be more open to first amendment restrictions, while the out-of-power group become desperate defenders of free speech (look how the campus free speech movement has shifted from the Left to the Right).

I would love to see a book on this covering the last 50 years.

From the LA Times, the US Government is demanding that soldiers repay enlistment bonuses years after they were promised

Nearly 10,000 soldiers, many of whom served multiple combat tours, have been ordered to repay large enlistment bonuses — and slapped with interest charges, wage garnishments and tax liens if they refuse — after audits revealed widespread overpayments by the California Guard at the height of the wars last decade.

Investigations have determined that lack of oversight allowed for widespread fraud and mismanagement by California Guard officials under pressure to meet enlistment targets.

But soldiers say the military is reneging on 10-year-old agreements and imposing severe financial hardship on veterans whose only mistake was to accept bonuses offered when the Pentagon needed to fill the ranks.

Note that there is no implication that there was any fraud on the soldiers' part -- they were offered a fair exchange and they took it.  The Federal government is trying to punish soldiers for potentially illegal or fraudulent actions of government workers.  Now that the soldiers have provided the service they promised, the government is trying to take back the money it promised.  But the soldiers cannot in turn take back their service.

This sort of retroactive one-sided reneging on government contracts and promises is actually fairly common.  For example, I wrote about it here, where private creditors lost all the money they loaned to the government when it was determined that the government officials who approved the loans did not have the authority to do so.  The punishment for the government taking out loans it should not have was to allow the government to keep all the money and screw the  private parties who lent them money in good faith.

I actually have faced this same thing a number of times in my own business.  I pay the government concession fees for the public campgrounds we operate.  There is a process by which the government can ask us to pay these fees in kind by doing some of the government's capital maintenance for it.  The government likes this because we can spend the money more efficiently and get more done with it, and we (and our visitors) like it because the money gets spent right in the park where the customer fees were collected.  However, it has happened on a number of occasions that some internal audit has determined that some agency official approved an in-kind project they should not have. When this happens, the government often comes to me and tells me that they need the money back.  My response is consistently something like, "Bullsh*t!  I have your approval to spend the money and your promise to be reimbursed in writing -- I can't unspend the money you asked me to spend.  There is absolutely no way I am going to pay the financial cost of you violating your own rules."

1.  There is absolutely no guarantee that spending more money increases service quality, especially when (as is the case with public schools) there is no competition to discipline spending and ensure that it is funneled to those aspects of the service that are actually important to customers
2. Over the last 20-30 years, administrative staffing in public schools has grown from a small percentage of the total to about half the headcount in many public school districts, and thus likely more than half the salary budget (since administrators frequently make more than teachers)
3. Much of the increased funding is going to retired teachers who aren't actually teaching anyone

Per-student spending on K-12 education has risen steadily over the last two decades, but student test scores, and teacher salaries, are stagnant. Why hasn’t this massive increase in investment produced better teachers and better opportunity for students? The short-answer, according to a new Manhattan Institute report by Josh McGee: State and local governments have catastrophically mismanaged their teacher pension systems. The cash infusion to K-12 has been used largely to pay for irresponsible pension promises politicians made to teachers’ unions and justified to the public with shoddy accounting. . . .

In other words, to cover benefits for retirees, states need to dig into education funds that might otherwise be used to attract and retain good teachers or buy better textbooks and build new facilities. So long as state governments are unwilling to reform the blue model pension-for-life civil service system, and so long as teachers unions continue to wield outsized influence in so many state legislatures, this pattern seems likely to continue indefinitely.

Campaigns to increase spending on schools are always popular, and understandably so: Education ought to be a great equalizing force in our society and, in theory, an efficient way to invest in the future. The problem is that in many states, new “K-12 spending” isn’t really an investment so much as a transfer payment to retired employees of the public schools who have been promised untenable lifetime pension benefits.

This is an absolutely fascinating article at Vox on efforts by green forces and the Left to defeat a carbon tax ballot initiative in Washington State.  The ballot initiative was written very similarly to my proposed plan, where a carbon tax would be made revenue neutral by offsetting other taxes, particularly regressive ones.

Apparently, the Left is opposing the initiative in part because

1. It turns out the carbon tax, for many on the Left, is more about increasing the size of government rather than really (or at least solely) for climate policy, and thus they do not like the revenue neutrality aspects.  They see carbon taxes as one of the last new frontiers in new government revenue generation, and feel like it would be wasted to make it revenue neutral
2. The Greens have made common cause with the social justice warrior types, so they dislike the Washington initiative because it fails to allow various social justice and ethnic groups cash in.
3. Apparently, folks on both the Left and the Right actually like government picking winners and tinkering in individual subsidies and programs, such as funding various green energy and conservation initiatives.  To me, that stuff is all a total waste and made irrelevant by a carbon tax, whose whole point is to allow markets to make the most efficient CO2 reduction choices, but looking at this election it would not be the first time the electorate was ignorant on basic economics.

There is a real disconnect here that it is important to understand.  I don't think I really understood how many of us could use the term "carbon tax" but understand its operation in fundamentally different ways, but I think that is the case.

The authors of the law, like me, see the carbon tax as a pricing signal to efficiently change behaviors in the market around use of carbon-based fuels.  The whole point of a carbon tax is to let individual actions and market forces shape how solutions are created.  But the Left seems to see the carbon tax totally differently.  They don't understand, or don't accept, the power of the pricing signal in the market, or else they would not say things like they want a "put a fee on emissions and reinvest that revenue in clean energy" -- the latter is a redundant and pointless government action if one accepts the power of the tax, since individuals will already be responding by making such investments.  The Left instead sees the carbon tax as the source of a new kitty of money that then must be fought over in some sort of political process.

Check out this passage, and consider whether these folks are thinking of the carbon tax as a pricing signal or a source of new money to be spread around:

Either way, state social justice groups did not feel consulted. "Rather than engaging with these communities," wrote Rich Stolz and De'Sean Quinn of environmental justice group OneAmerica, "I-732 organizers patronized and ignored concerns raised by these stakeholders."

White people who work with other white people — and the white people who write about them — tend to slough off this critique. What matters, they insist, is the effect of the policy, not the historical accident of who wrote it down.

Bauman points to a set of policy demands posted by Black Lives Matter. Among them: "shift from sales taxes to taxing externalities such as environmental damage." Also: "Expand the earned income tax credit."

"Well," Bauman says, "we did both those things, right?"

But communities of color want more than for mostly white environmental groups to take their welfare into account. Most of all, affected groups want some say in what constitutes their welfare. "All of us want to be included from the beginning of any decision," says Schaefer. "We don't want to be told after the fact, ‘Hey, by the way, we decided all this stuff for you.’"

This tension within the climate movement has played out most recently in California, where low-income and minority groups have won substantial changes to the state’s climate law, ensuring that a larger portion of cap-and-trade revenue is directed to their communities. Given demographic changes sweeping the country — and climate funders’ newfound attention to building up the capacity of those groups — those tensions are unlikely to remain confined to the West Coast.

These folks see the carbon tax as a pool of money to fund a patronage system, and are thus scared that any groups not involved in crafting the legislation will be left out of the benefits of the patronage -- after all, that is how most programs from the Left are put together.  The Obama stimulus program back in 2009 was such a patronage project, and those who were in on crafting it got windfalls, and those who were left out of the process had to pay for it all.  Either the Left assume that everything works this way, even when it does not, or they want everything to work this way -- I don't know which.

One thing I do know is that I fear I am going to lose this argument in the future.  Here is one way to look at it -- are more people graduating from college looking at the world through the lens of markets and economics and incentives or are more graduating structuring issues in terms of social justice and government authority?

From the WSJ, the dying business of picking stocks.

Pension funds, endowments, 401(k) retirement plans and retail investors are flooding into passive investment funds, which run on autopilot by tracking an index. Stock pickers, archetypes of 20th century Wall Street, are being pushed to the margins.

Over the three years ended Aug. 31, investors added nearly $1.3 trillion to passive mutual funds and their brethren—passive exchange-traded funds—while draining more than a quarter trillion from active funds, according to Morningstar Inc.

Advocates of passive funds have long cited their superior performance over time, lower fees and simplicity. Today, that credo has been effectively institutionalized, with government regulators, plaintiffs' lawyers and performance data pushing investors away from active stock picking.

The other day at dinner, I told a group of folks with more, uh, conventional political views than my own that this election was great.  When pressed on my seeming madness, I said that I was tired of people fetishizing politicians, starting with the cult of the Presidency.  History is written as if these losers drove most of history, when in fact the vast vast majority of our wealth and well-being today results from the actions of private individuals, private individuals who typically had to fight politicians to make our lives better.   Anything we can do to cause people to think twice about giving more power to these knuckleheads, the better.  And thus, this election is great -- like Dorothy stumbling on the wizard behind the curtain, perhaps going forward people will be a little less willing to blindly accept politicians as their betters.

The estate process for my parents is finally coming to a close, and we must do a final cleanout of their residence in preparation for selling it.  I ended up with 6 boxes of stuff I shipped to my house that I would classify as "things I really don't want and will likely never look at or use but I can't bring myself to throw away."  My mom's faded wedding dress is in this category, for example.  I need a word for this kind of item.

Typically what happens with this stuff, at least in my case, is a sort of time-based triage process.  I will store it, let 5 years or so go by and at that point, having never accessed any of it, I will get rid of a portion.  My school textbooks steadily vanished in this manner.  Rinse and repeat until the problem with the hard core of assets we can't bring ourselves to shed is passed onto our kids.  Or until something is old enough to migrate from old junk to valuable antique.

I did find a pretty cool, large award certificate my grandfather won at the 1904 St. Louis World's Fair, which I think I will frame.

I have written a number of times in the past that the media is often reluctant to publish potential issues about pending legislation that they support -- but, once the legislation is passed, the articles about problems with the legislation or potential unintended consequences soon come out, when it is too late to affect the legislative process.  My guess is that these media outlets want the legislation to pass, but they want to cover their butts in the future, so they can say "see, we discussed the potential downsides -- we are even-handed."

I don't know if this practice spills over from legislation to elections, but if it does, we should see the hard-hitting articles about Hillary Clinton sometime in December.

Yesterday I browsed for a utility sink at Lowes for my hobby room.  Today, I open Facebook for the first time in weeks (on a different computer) and find an advertisement for that exact same sink at Lowes in my feed.

You are being watched.