Paycheck Fairness Act is anti-womens' employment

Scheduled to come to a vote in Congress tomorrow, the Paycheck Fairness Act is a bad solution to a statistically trumped-up problem.

The most frequently cited statistic is that women earn 77 cents for every dollar a man makes. However, not all of that gap can be attributed to discrimination.

The Bureau of Labor Statistics reports that comparing male and female full-time workers, men work more hours: 8.2 versus 7.8 hours per day, on average. Just assuming an exactly even hourly rate, we'd expect women to earn 95% of men's total on a yearly basis; however, there are also more women working part-time than men, widening the gap further. Men are also disproportionately likely to die from an injury on the job, as this chart shows.

Source: US Department of Labor, Bureau of Labor Statistics, Current Population Survey, and Census of Fatal Occupational Injuries, 2012.

But put aside those statistical details. A gap in male-female wages undoubtedly remains, and some of it is probably due to gender-bias and discrimination. What does the Paycheck Fairness Act do to fix that?

The Act would strengthen the Equal Pay Act of 1963, which already requires similar workers be paid the same. The new legislation would expand the damages that women can claim in court, and give women more tools to sue their employers if discrimination is suspected.

The new law would result in effectively unlimited liability for a business sued for giving unequal pay. Put yourself in the shoes of a small business owner. Suppose you are considering hiring either a male or female employee for an entry-level position. Suddenly knowing that your business could be shut down if a court decides your payment to the woman is unfair, who would you be more inclined to hire?

Let's think of another group that has been "protected" by sweeping federal legislation. Persons with physical disabilities are given additional tort resources by the Americans with Disabilities Act if it's found that they were treated unfairly. A paper by Acemoglu and Angrist (2001), using reliable econometric techniques, found that employment of disabled people dropped substantially following the ADA's passage. Now, twenty years later, physically disabled persons are unemployed at record levels.

There are obvious weaknesses in the analogy between the Paycheck Fairness Act and Americans with Disabilities Act - women are a larger segment of the population, and aren't physically limited from doing most jobs - but a lesson remains. Creating new protected classes of workers is not always to that group's overall benefit.

Even well-intentioned laws may end up punishing businesses for hiring certain workers, which hurts both individuals and the economy as a whole. The Paycheck Fairness Act is almost certainly dead in the water; even without passage, its political purpose will have been achieved. But, if President Obama and the Democrats want to show they are helping women, a first step is to not shut them out of the labor market.

Don't interact with strangers' children.

The way current law is set up, being a Good Samaritan and trying to rescue someone else's kid can only get you in trouble.

Browsing the Internet, I've found a few anecdotes which support this view. I don't have any verification that they're true, so you'll just have to take my (and their) word for it.

First story: a young woman is waiting at a street corner. She sees a mother, who is not paying attention, whose child wanders out into the street in front of an oncoming bus. The young woman jumps out and pulls the child back onto the sidewalk. Her reward? The mother yelling "how dare you touch my kid!!" and our would-be hero is treated as a villain, and forced to flee the scene.

Second story: a young man is on the beach. He observes a small male child falling off his surf board a long distance from land. The young man swims out and rescues the child from drowning. On returning to shore, he's greeted by an irate mother who calls the police and wants to press charges for child molestation. Luckily, witnesses confirm the man's story and the cops let him go.

Following this second anecdote a (self-proclaimed) lawyer comments, describing how this situation could have led directly to the young man being registered as a sex offender. By the time police would have questioned the child, his head would be full of misinformation from the angry mom, causing him to tell the police what they "want to hear", possibly putting the Samaritan behind bars or at least requiring a costly and life-disruptive legal defense.

Now, I'm not blaming either the moms in this situation (they are probably freaked out and will naturally accuse the first person they see who might be responsible for their child's endangerment) or the harsh treatment of sex offenders (children should obviously be protected from predators). But it's worth noting the incentive effects that these sort of stories have on potential Good Samaritans.

My personal stance is to never interact with a stranger's child no matter what the circumstances are. I won't engage in conversation, nod, smile, or hold a door open. I was about to say that the most proactive thing I'd do if I saw a child in danger would be to record the incident on video to give to YouTube the authorities later, but even taking pictures of kids can get a guy in trouble... So I probably wouldn't even do that.

Being a Good Samaritan is really a lose-lose proposition. If I succeeded in saving the child, best-case scenario I get a pat on the back, worst-case is a sex-crimes trial that will haunt me for the rest of my life. If I fail to save the child (it still falls under the bus) then maybe I get accused of murder or assault because the angry parent saw me "push" the kid instead of trying to rescue it!

There is absolutely no upside to helping or interacting with a stranger's kid. Perversely, this fact makes being a Good Samaritan far worse: because rational people know it's a bad idea to help a kid, the people who do try to help are even more likely to be creeps or labeled as such (the selection effect).

In its efforts to prevent strangers from harming vulnerable children, society has also unintentionally deterred strangers from assisting vulnerable children. It's hard to say which impact is more important, but given the relative magnitudes (there are lots more healthy, well-intentioned people out there than sex offenders) it's very possible the overall effect has been negative for child safety.

Farm Subsidies: A Picture Worth 1,000 Words

Who ever said there's no skiing in Iowa? Source.

In other news, the Institute of Medicine is advising the government to adopt a series of policies to control the American "obesity epidemic." One such policy is a proposed "soda tax."

I have a better idea. Instead of taxing soda, why don't we repeal the subsidies which makes the primary ingredient, high-fructose corn syrup, so dirt cheap to produce?

Fish and Game Dept. targets Asian Supermarket - Flawed Economics in Action

A daring sting operation has brought down another set of dangerous criminals in our midst. The proprietors of Great Wall supermarket (located about 20 minutes from where I live) have been arrested for selling "wild" sea animals including live frogs, crayfish, turtles, eels, and more. The store owners say that all of their stock comes from farmed sources, but that does not appear to be convincing the crusading Commonwealth bureaucrats.

Officer Rich Landers, of the Virginia Department of Game and Inland Fisheries, had this to say:

“History has show when wildlife becomes commercialized, the population dwindles,” Landers said. “Whether it’s elephant tusks or whales, we are trying to reduce the chances that wildlife becomes commercialized.”

Lets take a moment and think of a heavily commercialized animal population, like cows. We may have another disaster on our hands: the cow population is down to the lowest level since 1958, with only 92.6 million in the United States! An estimated 25 million cows are slaughtered each year. That means that in less than four years, there won't be any cows left in the United States. Savor your steaks while you can!

See what's wrong with this story? While commercialization allows animals to be consumed, it also creates strong incentives to rebuild the population for future consumption as well. That's why the decline in the cow population has been in response to reduced profitability of cattle ranching... not an ecological shortfall. Why would this be any different for farmed eels, turtles, or fish?

The historical examples that Landers uses are all cases where no one had ownership rights over the stock of animals being hunted, and therefore no reason to maintain sustainable population levels. That is clearly not the case here when we are discussing farmed seafood.

If anything, the proprietors of Great Wall should be applauded, for meeting consumer demand for uncommon (by American standards) foodstuffs. That way, Asian families can eat farmed eels etc. and do not have to catch them wild or import from abroad, potentially bringing exotic animal diseases to afflict U.S. ecosystems.

I won't go so far as to accuse the Department of Game and Inland Fisheries of racism or xenophobia, as I'm sure they'd be just as happy to apply their short-sighted and fallacious brand of reasoning to a predominantly-American grocery store as well. But, charging honest business owners with felonies, for selling live turtles and bass, does not inspire much confidence in either the agency's competence or its underlying motives.

Netflix original programming: trying to stay ahead of the competition?

Netflix has been through some hard times lately, and the industry is evolving in ways that will continue to challenge their core business model. A combined deal between Redbox and Verizon has been struck in order to offer streaming video. Redbox is also buying out DVD kiosks owned by Netflix' old rival, Blockbuster, to expand their on-the-ground presence.

Netflix is already in a market with big-name competitors for streaming video - Hulu, Apple, Amazon and Walmart, to name a few - as well new outfits such as Zediva (which offered rock-bottom prices, but ran into legal troubles due to avoidance of content licensing fees). Netflix sets itself apart with the DVD mailing program, but Redbox is now well-positioned to compete on that front as well.

How to stay ahead of the curve? Netflix just introduced their first offering of original programming, Lillyhammer, with more shows planned in the next year.  Now, with Netflix moving toward an "HBO model" of producing and distributing their own content, their core business will be changing.

There is some clear logic to this decision: instead of paying extravagant licensing fees to stream content (the deal with DreamWorks is estimated to place a $30 million price tag on each film) new shows can be produced internally. New exclusive content could also pull in subscribers drawn to a particular actor or show; this may explain why Netflix is rumored to be producing Arrested Development Season 4.

During the short-lived introduction of 'Qwikster', some speculated that Netflix was drifting away from its core expertise. It's not immediately clear how DVD mailing translates to streaming content. Now, the company is shifting its role once more, and one is left to ask whether film production is also part of the Netflix tool kit.

Vertical integration in the entertainment industry is hardly a new phenomenon. But, most television networks started off producing content, and then acquired more means for distributing it. Netflix got into the distribution business first, and now is trying to backpedal into producing as well.

It's unclear whether the few big-name offerings which Netflix will produce are enough to distinguish them from the other streaming services. But, facing stiff competition in both physical and online distribution channels, moving up the content production chain may be the only choice they have in order to stay relevant.

Komen Foundation Pilloried for Planned Parenthood Policy - and Rightly So

Earlier this week the Susan G. Komen for the Cure Foundation said they'd be eliminating their grants to Planned Parenthood for breast cancer screenings. The resulting social media uproar, however, quickly caused them to reverse that decision and issue a sickly-sweet apology press release.

I know blood in the water when I see it; my duty to the blogosphere wouldn't be met without helping to smear Komen's momentarily-vulnerable public image further. After all, it's not every day you can feel righteous while slinging mud on a charity.

The recent furor raises a broader question: how much of what the Komen Foundation does is actually getting us closer to a cure for breast cancer? According to their website, 84% is spent "on our mission." But, that "mission" is defined pretty broadly.

From Komen's donation page.

The screenings, research, and treatment services that Komen provides are definitely valuable, but those only make up 46% of the overall budget. That leaves 54% percent taken up by administration, fundraising and "education" (a.k.a. advertisements). Basically, for every dollar that Komen takes in, a little over half of it goes out toward seeking another dollar. It's inefficient.

Maybe "education" about the risk of breast cancer is important, and causes some people to get treatment who otherwise would not. But, there are obviously some diminishing returns to awareness. Breast and prostate cancer are the number two causes of cancer-related deaths for women and men, respectively, but breast cancer receives much more public money and attention.

Data source: Aminou R, Altekruse SF, Edwards BK, et al. SEER Cancer Statistics Review: 1975-2006. Cancer Statistics, National Cancer Institute. May 29, 2009

A cynic would say that it's more fun to talk about breasts than the inside of men's asses, and probably be right. Some recent "sexy" breast cancer awareness campaigns help to reinforce that cynical view. While the incidence of prostate cancer has risen rapidly over the last 20 years, much faster than the rate of breast cancer, the National Cancer Institute spent twice as much on breast cancer as it did on prostate cancer in 2008.

There shouldn't have to be a fight between different anti-cancer organizations for funding. All of these diseases deserve serious study and research toward a cure. But, there also shouldn't be pseudo-political organizations like the Komen Foundation sucking up resources for runs, pink ribbons, Facebook campaigns, "awareness", and other things commonly known to not stop cancer. If you want your donation to make a difference, write a check to a research lab, not a lobbying group. With their stance on Planned Parenthood, the Komen Foundation has revealed itself to be much closer to the latter.

Collective Action Solutions for Libertarian Politics

The biggest problem for an individualistic, freedom-oriented political movement is getting each of those individuals to join any sort of movement in the first place.

Many economists wonder why anyone votes at all  -- the chance of any one ballot changing the outcome is statistically zero and the cost of voting is small but positive (e.g. risk of dying in a car accident on the way to the polls), so rationally it would be better to stay home on election day. Most people vote out of a feeling of moral obligation or civic duty.

The low impact of voting helps to explain why barely more than half of the American electorate usually shows up to vote. That problem is magnified for a political party whose "base" has a strong individualist leaning; they are less likely to feel the civic obligation which pushes others to the polls.

Enter the Free State Project. Goal: collect signatures from libertarians, who will move to New Hampshire when total signatures reach 20,000. Why New Hampshire? It has low tax rates, little dependence on federal spending, and a small enough electorate that 20,000 people might be able to sway its political orientation.

In economic jargon, the Free State Project uses a pre-commitment device to solve a collective action problem. No one is asked to move to New Hampshire until sufficient signatures are obtained (as of this writing there are 11,578 participants; 8,422 to go). Any one person moving to New Hampshire in order to change its politics would bear a large cost, with uncertain chance of success. Assuming people stick to their word, the Free State Project allows each person more confidence that their action will make a difference.

Agree or disagree with the libertarian political platform, it's hard to argue about because there are few real examples of libertarian societies to reference. I hope the libertarians do succeed in taking over New Hampshire, because it will be an interesting test case for a liberty-motivated legislative majority. Even if the result is a total disaster the impact will be negligible, and the advance in knowledge for political science / public choice well worth it.

The American Entertainment Industry's Death Rattle

It's obvious that the circumstances which allowed so much wealth to be accumulated in Hollywood by major record labels have changed, but the people at the top don't want to change with them. The industry's demise (at least in its current form) is evidenced by the great efforts being made to legislate demand for their products - through the SOPA/PIPA legislation in Congress, which led to a blackout of many popular sites yesterday, and today's effort to shut down Megaupload.com as a copyright infringer.

Piracy is not really the problem here, but a symptom of a larger issue: the entertainment industry wants to charge more for their products than people are willing to pay. Maybe people used to be willing to pay $15-20 for a CD, but no more. With digital distribution, artists can sell their music to fans directly, without the entertainment edifice standing in between. This is a better deal for both musicians and fans, but makes most of the music industry obsolete. The same is not exactly true in Hollywood - someone has to finance big-budget action flicks - but digital services such as Netflix Watch Instantly are changing the game there too. Why would I go pay $12 to see a movie in a theater, when I can pay $8 per month for more streaming content than I can watch in a lifetime?

Even if online piracy were eliminated completely, it wouldn't address the bigger issue facing the entertainment industry: substitution. Consumers have an increasing variety of entertainment options to choose from, many of which are free or extremely cheap. Now that online distribution is easy, there's really no need for the big industry surrounding content distribution. They can kick and scream all they want, but the entertainment industry as we know it is functionally doomed. It just doesn't realize that yet (or is trying desperately to deny the obvious).

Liberal Arts Degrees as Social Signaling

The model of education as signaling for the labor marketing has been thoroughly developed by Bryan Caplan; for some examples, see here, here, and here. I think the argument is pretty convincing, but it leaves a few details unexplained. Namely, some majors - especially liberal arts - are not even very good as signals!

The highest unemployment rates for college graduates are found among architecture, art, and humanities majors. Especially given the relatively low salaries for jobs in these "industries" why go into serious debt to get a degree, when the signal is likely to be weak or even totally ineffective? While the number of liberal arts colleges has been declining over the last 20 years and business is the most popular major for under-graduates (chosen by 20% of students) the liberal arts curriculum is far from disappearing.

It could be that these students are maximizing with regard to something other than wealth, such as social status. This may accrue to either the college student or that student's parents, who get to brag about how their son/daughter will be a progressive hero and "save the world one day." Parents have incomplete control over what major their child picks, but at least some power to encourage or discourage certain fields of study.

Thinking of education as a status symbol helps to explain variation in choice of majors across countries. In the United States, the poor and middle-class can get luxury items like fancy cars, jewelry, nice TVs, smartphones etc. by using credit (Robert Kiyosaki's "Rich Dad Poor Dad" observes that this is a big reason why they do not ascend to the capitalist upper-class). Seeing someone with nice jewelry or the latest tech is no longer a good indicator of high status in America; in fact, it is often a signal of the opposite! A liberal arts degree then becomes a new status symbol, a way of displaying "yes I can spend four years doing nothing productive, and rack up debts while doing it, because money isn't important to me."

In China, by comparison, most of the affluent or middle-class people have attained that status within the last one or two generations. The rich in China display their wealth through luxury items, but parents still often discourage or frown upon liberal arts degrees (or so I'm told by someone with personal experience). Based on the social signaling theory sketched out above, one would expect that as the middle-class in China grows and expensive items are no longer limited to the nouveau riche, more will go get liberal arts degrees, instead of the focus on STEM (science, technology, engineering, and math) which is the stereotypical image of Chinese students currently.

If this model is accurate, it just further reinforces Dr. Caplan's point that we should not be subsidizing higher education as much as we are now.

How to judge campus safety?

A few days ago I was emailed a pdf document: the 2011 Annual Security Report for George Mason University. As mandated by the Jeanne Clery Disclosure of Campus Security Policy and Campus Crime Statistics Act (yeah I hadn't heard of it before either) it provides a breakdown of all criminal activity which occurred on campus, by year, and with special columns for "Hate Crimes." The picture I attached has the numbers for Fairfax. This is the most interesting part of the document to me because it contains some raw figures on different offenses committed in the campus I attend. Statistics for the other George Mason campuses (Arlington, Prince William, Loudoun, etc.) are also available but are a lot less edifying, because the columns have just a bunch of zeroes. Coincidentally, Fairfax also happens to be the only campus with attached undergraduate housing -- make of it what you will.

The most exciting table I've seen since breakfast.

This report is obviously intended to increase public awareness about crime rates on campus, allowing potential students and their parents to make an informed decision when comparing different universities. What I wonder is, how does someone look at this report and get any sense of the probability that they themselves will be victimized? This blog post is a rough attempt at answering that question.

Some useful figures to get started with:

• Roughly 30,000 students attend GMU, 7,000 of them on living on campus.
• From the BJS, around 35% of property crimes and 45% of violent crimes are reported to the police.

"Coupon Lady Money Saving Madness" is madness indeed.

So, I found a video on the internet which should have bargain-hunters, cheapskates, and economists (to be redundant) foaming at the mouth. By using coupons and mail-in rebates, a woman was able to cut her grocery shopping bill down from over $150.00 to just $9.43. Find the video here. So why isn't everyone saving 97% on their shopping, and putting the grocery stores out of business?

The reason most people don't do this (and never will) is because it's inefficient. Yes, it's very impressive to see someone save ~$145 off their groceries, but the real question is how much time did it take, in coupon saving, organization, and so on, in order to accomplish that? The woman in the video said she collects coupons, sends in rebates, and plans all her shopping in advance... If it took her 14 hours, she effectively earned $10/hour for her coupon-clipping work. However, I'm guessing it took longer than that, and her "wage" was actually much lower.

For people who have jobs, it'd be more effective to spend those extra hours working than clipping coupons. If you don't have a job or are paid a very low wage, coupon clipping could make sense. However, there are a variety of other ways to make money on the internet - filling out surveys, using ShortTask, or advertising on Twitter - to name just a few. For an hourly rate, you can almost certainly do better than coupons.

If you're a college student, spend that time studying instead -- you're going to school to make more money later, so focus on grades, not penny-ante coupons (unless you're studying english or sociology, in which case I suggest dropping out and coupon-clipping full time, because it'll be more profitable).

There's an efficient level of coupon saving, which depends on your income and how you value your time. For highly paid professionals, the efficient amount of coupons might be zero, while some others may gain a small benefit from spending their time that way. Taking coupons to an obsessive level, as this woman appears to have, is just wasting time for yourself and everyone in line behind you.

Scary statistics for the medical economics debate.

[The shaded box is around my response.] Survey Source.

Stumbling around the internet awhile back, I came across this medical ethics questionnaire. In addition to providing a haven for procrastinators, this survey also shows the distribution of answers that others have made. Most of the questions were fairly ho-hum with predictable splits of opinion. However, the skew of answers to an economics-related question startled me.

When asked "what level of involvement should the government have in setting prescription prices?" a whopping 56% of the responders said "Create Price Ceilings" and 8% more thought the government should set all prescription prices. Apparently, 64% of those polled trust bureaucratic regulators more than the market when it comes to pricing medicine.


I can appreciate the sentiment behind price ceilings on prescription medication: it's undeniable that many people can't afford treatment they need to stay healthy. However, price ceilings are just a bad idea. 

Source.

For those unfamiliar, a brief rundown on the economics of price ceilings. When the government mandates a below-market price for a good, it creates several negative side-effects. Most immediately, amount supplied decreases. Faced with a lower price, manufacturers will cut back on production. In context of prescription medications, this means less drugs being developed, tested and sold to the public. Ailments that could potentially be treated will continue to harm people. Slightly more subtle is dead-weight loss, which represents market transactions which could have occurred, but did not. In other words, some people could have benefited by paying the higher price to get the drug, but the price ceiling prevented them from doing so. As a result, both consumers and producers lose out, although the outcome for the person seeking medication is perhaps most tragic.

High costs for prescription medications are definitely a problem; health care costs in general have been rising much faster than the general rate of inflation, putting important treatments out of reach for many people. High drug prices have also helped drive up health insurance costs, presenting a large drag on businesses.

Instead of an artificial cap on prescription prices, it would be more productive to look at the supply-side factors which keep those costs high. The lengthy FDA approval process alone costs "about $800 million per approved drug" and creates instant pressure for the company to charge high prices and recoup their investment upon release. Taking aim at these restrictions would be better than capping prices and ultimately smothering the development of life-saving medications.

Laws against 'texting and driving' haven't made us any safer.

We've all seen it: alarming, dangerous driving behavior perpetrated while under the influence of cell phones. In response to this threat, many locales (including my home state of Washington) enacted bans on texting-while-driving. Has the menace of distracted drivers been curbed?

According to a USA Today article, traffic accidents have actually gone up in areas where anti-phone laws were enacted. To quote the most interesting part:

"Texting bans haven't reduced crashes at all," says Adrian Lund, president of the Insurance Institute for Highway Safety, whose research arm studied the effectiveness of the laws.

Teamster wisdom on political economy

If God allowed everybody to die in bed, the government would regulate that we'd have to sleep standing up."

-Alex (on History Channel show Ice Road Truckers, Season 2 Episode 4).

------------------------------------------

For context: Alex is driving a big-rig and hauling a 45-ton piece of mining equipment across the arctic ocean. The road he's driving on consists of nothing but frozen ice, and there's a blizzard rapidly approaching.

In addition to steady nerves and a dry sense of humor, the man has an intuition for political economy. I'll just let the quote above stand on its own. Thoughts?

Bedbugs. Yet another reason to hate Rachel Carson (aside from 800 million dead of malaria).

The history of malaria is interesting, in a macabre sort of way. A hardy parasite spread by insects, the cause of malaria was unknown for most of human history. The name we know today comes from the French phrase for "bad air," reflecting the common observation that malaria cases peaked around swampy areas. Their solution in Algeria - drain the swamps - was effective, but costly.

Malaria, the organism, is extremely difficult to kill. However its crucial vector, the mosquito, is vulnerable when combated with the correct chemical tool. In 1939, Paul Mueller discovered just that: DDT. This insecticide is cheap, effective, and quite safe for humans. Some claim it causes cancer, but their evidence has since been disputed. By comparison the malaria problem is undeniable and catastrophic, with millions dying on a yearly basis. As said by Wenceslaus Kilama, the Chairman of Malaria Foundation International "this is like loading up seven Boeing 747 airliners each day, then deliberately crashing them into Mt. Kilimanjaro."The imagery is hard to overlook.

The history of bed bugs is less interesting, but in a much more annoying way. Like malaria, bed bugs have plagued humanity since the dawn of time. They cause irritation, swelling, and definitely a terrible night's sleep. We're still combating this invasive parasite as well -- a national Pest Convention is meeting to discuss the issue. Exterminators have been caught by surprise as bed bug infestations have sprung up in the last several decades across the country, and surprisingly little is known about them.

What do malaria and bed bugs have in common? They've both been increasing since DDT usage was halted thanks to Rachel Carson's book, Silent Spring. Some people claim that bed bugs' modern upsurge is just due to increased travel. I think the facts say otherwise, given the almost total eradication of bed bug cases during the heyday of DDT's popularity. That issue aside, there's no disputing the deadly impact of malaria -- a plague that can easily be prevented by regular spraying of DDT.

The public outcry prior to the DDT ban is a classic example of action taken without full understanding of the consequences. Enough has been written on this already, so I won't belabor the point. Ultimately, Rachel Carson isn't the only one to blame; fault rests with the politicians and lobbyists who listened to her before all the evidence was in. Now, the public at large is feeling the consequences from decisions made forty years ago. With bed bugs infesting the Big Apple, maybe it will get people itching for change in our national pest control priorities.

Statistical Fallacy #002: Confusing Correlation with Causation. Does a strong handshake really make you live longer?

Even highly educated and intelligent medical researchers aren't immune to statistical errors. A recent study in the British Medical Journal referenced 33 other studies on personal mobility and life expectancy, and compiled their results. According to Reuters, 

They found simple measures of physical capability like shaking hands, walking, getting up from a chair and balancing on one leg were related to life span, even after accounting for age, sex and body size. 

While the phrase "accounting for age, sex and body size" makes this process sound very objective and scientific, there are obviously a lot of other factors that can play a role in life expectancy. Personal differences, such as leading a more active lifestyle, could cause someone to have both more hand strength and also better health in general which contributes to their longevity.


While statistics saying "the death rate over the period of the studies for people with weak handshakes was 67 percent higher than for people with a firm grip" sound very dramatic, it's hard to say if that relationship is reverse-causal; in other words, having a weak grip may signal your lifespan will be short, but will improving your grip really make you live longer? Probably not, which suggests it's far more likely that a common variable - for example, sitting on the coach all day - causes both weak hands and a lower life expectancy.


Common sense says that working with a stress ball or doing forearm exercises to develop a crushing handshake probably won't substantially reduce your chance of death from heart disease, cancer, stroke, or the other leading causes of death for adult Americans. However, this is exactly the impression given by the Reuters article title "Want to live longer? Get a grip!" Heavens forbid someone took this seriously and developed gorilla-like forearms only to find out their fitness investment had been in vain.

Private funding for prison rehabilitation -- latest British innovation.

Say what you will about eccentricities in the United Kingdom's political structure, they aren't afraid to try some new things. Particularly, in the area of penal reform.The U.K. prison system is struggling with extremely high recidivism rates; according to the BBC "60% of criminals who serve short sentences reoffend within a year of leaving prison."

So what's the plan? Much like purchasing a bond, investors can put money into the rehabilitation program (currently limited to male inmates with sentences less than one year). If reoffenses among the subject group drop by a specified amount, the investors receive dividend payments.

Quoting the BBC:

Attention Undergrads -- you're still paying for all those classes you skipped.

Graph made by Mark Kantrowitz of FinAid.org

We've reached a momentous, but little celebrated moment in financial history. Credit card debt has been surpassed by student loans (including both federal and private). Let's give a big 800 billion cheers for education!

You can see this trend in the graph to the left. Notice how in 2008, credit card debt peaked and has now declined, while student loan debt has gone up at a steadily increasing rate. The modern family unit (mom, dad, and the federal government) have been paying a larger and larger bill, and for those who can't afford it, the slack has been taken up by private lenders. Unlike credit card bills, which fluctuate with the larger economic climate, student loan debt just kept going up and up.

Education is always a good investment, right? With costs of tuition rising by 8% per year, one might expect students would soak up every valuable minute of classroom instruction. That hasn't been the case. While tuition rates have gone up steadily, student attendance has gone down. This trend has been especially strong in recent years. According to Blair Hedges, a biology teacher,

The 'Landes Law' on imperialism and its domestic corollary.

Historian David S. Landes

In his New York Times bestseller The Wealth and Poverty of Nations: Why Some are so Rich and Some so Poor, David Landes claims

"a law of social and political relationships, namely, that three factors cannot coexist: (1) a marked disparity of power; (2) private access to the instruments of power; and (3) equality of groups or nations." [63]

Penned in 1998, this writing still sheds some interesting light on our recent foreign policy adventures in Afghanistan and Iraq. Conspiracy theories and "blood for oil" slogans aside, private companies did have a large involvement in immediate invasions as well the as follow-up occupations. Along with industry lobbying and corporate connections in the White House, condition (2) seems to have been justified. The marked disparity of power and inequality between groups hardly even need discussion.


On face, the principle at work here seems accurate. As Landes argues, "Where one group is strong enough to push another around and stands to gain by it, it will do so." However, this incentive isn't limited to foreign policy. I'll propose the following corollary to Landes Law:

Welfare State Corollary: three factors cannot coexist: (1) a marked disparity of specialized interests; (2) private access to the instruments of government; and (3) national government running a balanced budget.

In other words, when an interest group (e.g. farmers, doctors, bus-drivers, etc.) has enough political influence, it will push others around through the legislative process, as long as it stands to gain by doing so. When a multitude of such interests exist, satisfying all their demands will flout any efforts at a balanced budget (unless taxes are incredibly high, and there's an interest group against that too).

While Landes' Law poses a serious challenge to efforts at global peace, the Welfare State Corollary has implications on our current political system's ability to respond to the current financial crisis. I'll leave it to the reader to decide on the accuracy of this analogy.

Is Hoarding a disease, or just un-economic? Some advice for the cluttered.

Who doesn't need 70,000 empty beer cans?

People with their finger on the pulse of reality TV (like myself) are shocked and disgusted by the spate of shows surrounding the issue of "hoarding." For the unexposed: the premise of such a show is that people with a serious clutter problem ("hoarders") ask for help from the reality television deities to clean their places. Then, the audience gets to be amused and disgusted as the hoarder whines, moans, and otherwise impedes the cleaning crew from taking out the junk. Apparently it's a successful formula, because several different networks are now doing "Hoarder" themed shows.

Economics does a lot of theorizing about consumption, and generally the assumption is that more = better. Presumably, a person will only buy something if it makes them happier or brings them some sort of utility. TV about hoarders is a case study in diminishing returns from possessions. In other words: the first 10 antique lamps and teddy bears were wonderful, but after there are 500 and you're sleeping on a single chair while living in fear of death by trash-alanche, then more stuff has become a dis-utility.