Great Minds and Hive Minds

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Scott Alexander on Garett Jones’ book:

Hive Mind‘s “central paradox” is why IQ has very little predictive power among individuals, but very high predictive power among nations. Jones’ answer is [long complicated theory of social cooperation]. Why not just “signal-to-noise ratio gets higher as sample size increases”?

Me:

Can we rule out statistical artifact? Put it this way. Suppose we chose 1000 people at random. Then we create 50 groups of them. Group 1 has the 20 lowest IQ scores. Group 2 had the next 20 lowest IQ scores, etc. Then we run a regression of group average income on group average IQ for this sample of 50 groups. My prediction is that the correlation would be much higher than you would get if you just took the original sample of 1000 and did a correlation of IQ and income. I think that this is because grouped data will filter out noise well. Perhaps the stronger correlation among national averages is just a result of using (crudely) grouped data.

Tyler Cowen’s Militarism Matrix

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He writes,

There are the libertarians, who hate martial culture on the international scene, but who wish to allow it or maybe even encourage it (personally, not through the government) at home, through the medium of guns. They are inconsistent, and they should consider being more pro-gun control than is currently the case. But I don’t expect them to budge: they will see this issue only through the lens of liberty, rather than through the lens of culture as well. They end up getting a lot of the gun liberties they wish to keep, but losing the broader cultural battle and somehow are perpetually surprised by this mix of outcomes.

To put his post in matrix terms, suppose that we have

low-profile foreign policy high-profile foreign policy
anti gun control Reason supporters Trump supporters
pro gun control Bernie Sanders Democrats Hillary Clinton Democrats

Tyler’s claim is that only the diagonal positions are culturally consistent. The upper right quadrant is into defending personal honor and national honor. The lower right quadrant is into Kumbaya pacifism. The off-diagonal positions face the problem of cultural dissonance. One likes to see Americans use guns abroad but not at home. The other likes the reverse.

My thoughts:

1. You can see the Presidential candidates in the off-diagonal boxes struggling with the awkwardness of this cultural dissonance. Reason fave Rand Paul is soft-pedaling his anti-interventionism, in what seems to be an unsuccessful attempt to avoid alienating the upper right quadrant. Hillary Clinton will not concede that intervention in Libya and Syria had adverse consequences. (As Bryan Caplan puts it, politicians are adept at “packaging even their worst actions in conventional moral garb.” ) But I bet that you will not see her trying to put foreign policy on the top of the debate agenda within the Democratic Party.

2. The quadrants do not quite map to Walter Russell Mead’s four foreign policy types. The Bernie Sanders Democrats might be Mead’s virtue-seeking Jeffersonians. The Hillary Clinton Democrats might be Mead’s safe-for-democracy Wilsonians or his safe-for-capitalism Hamiltonians. The Trump supporters might be his Jacksonians. The Reason supporters are Jeffersonian in spirit, but they do not get along with the Bernie Sanders Democrats.

3. I will say it again. This is not a libertarian moment. Still, I think that libertarians have a lot to contribute to the public debate. What we should do is remind others that (a) the political process almost never adopts an ideal policy or executes a policy well and (b) policies that seem good today can have unintended consequences tomorrow.

4. I do not see any guaranteed solutions here. If you think that unrestricted gun ownership promotes freedom, are you prepared for the police powers that the public will gladly accept in order to prevent more mass shootings? If you think that gun control is the answer, do you have a credible enforcement strategy? If you want more intervention in the Middle East, are you prepared for the winners that we back to turn out to be not such good guys? If you want less intervention in the Middle East, are you prepared for what the bad guys might do?

Yes, that was my picture

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A friend at dancing last night said that she saw my picture in the NY Times. I could not figure out what she meant, but she was right! If you scroll down in the article, you will see a picture from 2011.

At that hearing, I discarded my prepared remarks and instead called out the other two guys as representing special interests. The Democratic Senator chairing the hearing was not happy. I am actually rather proud of that one.

Incidentally, the Times story is slanted in an odd way. If you know anything about the Fannie Mae lobby in its heyday (and many of its hatchet men are still active), you would say that calling Fannie Mae a victim of lobbying is like calling Donald Trump a victim of harsh rhetoric.

Guaranteed Income With Red Tape

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A commenter points me to this guaranteed income (GI) proposal.

With my preferred version of GI, the state requires welfare recipients to work for the private sector (not govt. jobs or non-profits), but allows everyone in program to “Choose Their Boss.” They are not required to take the highest paying jobs on offer.

There are many pitfalls here. Somebody could create a “job” that allows you to work from home and do nothing, as a way of enabling people to collect benefits. Somebody who now employs low-skilled workers at a market-competitive wage could use the GI program to replace those workers with below-market-wage workers.

My problem is not that the author is unaware of such pitfalls. He clearly is worried about them, and so his proposal includes a long list of regulations, many of which strike me as very costly to enforce. The package does not appeal to me.

The Latest News

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is Donald Trump’s call for a ban on travel by Muslims to (in?) the U.S. My reaction to this relates to my review of Greg Ip’s book, Foolproof, which is about risk policy. My point there is that both policy makers and ordinary citizens make bad risk judgments when they respond to the salience of a risk rather than computing costs, benefits, and probabilities. The Muslim origins of the San Bernadino terrorists may be salient, but that does not mean that Trump’s response is wise.

When you choose a policy in a war, it makes sense to maximize the adverse effect on your enemy and to minimize the adverse effect on friends and neutrals. Trump is proposing something that would do the opposite. So even before you get into the moral hideousness of it, his idea fails on practical grounds.

It reminds me of interning Japanese-Americans during World War II, which was morally and tactically wrong.

Libertarian Scandinavian Welfare State?

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Olivia Goldhill writes,

The Finnish government is currently drawing up plans to introduce a national basic income. A final proposal won’t be presented until November 2016, but if all goes to schedule, Finland will scrap all existing benefits and instead hand out €800 ($870) per month—to everyone.

Pointer from Tyler Cowen.

Before the 2016 election turned into a Trumped-up referendum on immigration, I had a vague hope of promoting a roughly similar idea for the U.S. Get rid of food stamps, housing subsidies, Federal payments for Medicaid, etc., and replace with a basic income. Let the states or local governments deal with people who have particular needs, such as people with uninsurable medical conditions.

What are they Insinuating?

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In the print edition of the Washington Post, the headline on this (lead) story reads

Female shooter got ‘so religious’

I have been going back on what they meant. Two possibilities

1. They meant that becoming a more devout Muslim is associated with a propensity toward terrorism.

2. They meant that becoming a more fervently religious person, regardless of faith, is associated with a propensity toward terrorism.

If (1), then it seems to me that they are to some extent justifying Islamophobia.

If (2), then it seems to me that they are indicting all forms of religion.

(1) seems odd coming from the Washington Post.

(2) just seems odd. “Meghan goes to mass regularly. Watch out for her.” “Moishe has started to lay tefillin. Call the FBI.”

So I keep going back and forth.

Narayana Kocherlakota on How the Fed Spoiled the Economy

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Scott Sumner correctly sees Kocherlakota as supporting Sumner’s view of Fed policy during the financial crisis and its aftermath. Kocherlakota says,

I use the public record to document that, as of late 2009, the FOMC felt that it would be appropriate to use its monetary policy tools to foster a relatively slow recovery in both prices and employment. (The recovery that actually unfolded was slower than the FOMC intended in terms of employment, but close to the FOMC’s intentions in terms of inflation.) I argue that the FOMC’s guarded response can be traced back to its pre-2008 policy framework—that is, to the Taylor Rule. Indeed, because of this baseline “normal” policy framework, the FOMC and many outside observers actually saw the Committee as pursuing a highly accommodative policy.

Read the entire speech, or at least read Sumner’s excerpts from it.

Kocherlakota has lobbed a grenade into the macro establishment’s room. If he (and Sumner) are correct, then history will not be kind either to the Bernanke Fed or to the Taylor rule.

Much as I would love to see those icons brought down, for the moment I am going to stick to my view that the Fed did not set the course for the economy.