Archive for April, 2011

Gas prices: not so simple as some insist.

Why do gas prices go up fast but settle slowly? Bob Sullivan takes a look at the issue. He notes that gas prices make for an excellent economic laboratory because of their volatility and the widespread consumer reporting of price on websites like GasBuddy. What he finds is that the price of gas is not so simple as some of the politicians try to assert by blaming it on some chosen evil villain.

Any study of retail gas prices risks ignoring complex factors in a market that is anything but pure: The spot price is controlled by speculators making bets on the whims of the oil producing nations’ cartel, the threat posed by government-subsidized energy alternatives and the likelihood of another environmental disaster, to name a few. A mysterious wholesaling and distribution system adds to the cost in difficult-to-measure ways. Also, gas stations often make very thin margins on retail gas sales – many use gas as a loss leader for chips and soda sales. As prices go up, their razor-thin margins shrink toward zero, Lewis said – and station owners naturally try to recover some of those lost profits as prices head back down.

Making the issue even murkier, behavioral economists will tell you, is the fact that gas shoppers are anything but rational agents who constantly seek out the best price. Instead, many are pesky realists for whom the nearest station will do. On the other hand, some consumers overestimate the true value of a cheaper gallon of gas, because they underestimate the cost of driving to get that cheaper gas (what economists call “search costs”).

All goes well until the end of the story where the author’s ideology surfaces

If there is a general lack of price sensitivity when prices fall, basic supply and demand just took another body blow, and comparison shopping just isn’t what we thought it was.

There is no body blow to supply and demand if the consumer is ‘conditioned’ and fails to exercise discretion as the story suggests. That phenomena only shows that supply is not a simple thing as consumers have many factors that enter into their decisions.

The data show that retailers respond rapidly to wholesale costs but are a bit slower when it comes to competition. The impact of wholesale costs on profit are direct and immediate and clearly defined. The competition incentive is slower because it is consumer driven and a much more complex phenomena. That is why gas prices respond quickly to supply costs going up but more slowly to competition going down. Nothing mysterious; no conspiracies; no evil greedy manipulators out to steal money from the poor; just a market working its way through many different phenomena.

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Business growth paradigms and constraints

The question is Why did the iPod win and TiVo lose?. Fortune considers a few reasons. Both showed up a decade ago and both were means to record and play media.

The reasons offered include the fact that Apple had more than ten times the capitalization to leverage its effort; Apple didn’t have competitors providing bundled packages like the cable companies that TiVo faced; and the music industry is an entirely different business model than the advertising supported TV industry.

Apple also had iTunes, its proprietary software that let iPod users purchase and manage their music collections. iTunes was much more than this, however: It was pitched to music labels as a viable response to music piracy — certainly much better than any solution the industry had come up with. This helped Apple win over not just consumers, but the providers of digital music.

The music industry is still fighting a piracy phantom and stories about RIAA lawsuits hit the news on occasion (see but the transition to electronic distribution of music is now mainstream. Video is just beginning to catch up with companies like Netflix or Amazon but it is still difficult to legally obtain a video file for a personal library like one can with an mp3.

So TiVo is left with a superior DVR technology, and a shelf full of patents for many of its features. If TiVo does prevail in its lawsuits against Dish, it could bring in as much as $3 billion in a settlement. And it could give the company a war chest to take on other pay-television providers who sell Tivo knockoffs to their subscribers.

The comparison and contrast is that Apple is using innovative technologies with a focus on consumer demand while TiVo (and its partners) has its focus on protecting intellectual property. That leads to the patent issues that have plagued modern technology for at least the last twenty years and have yet to be resolved.

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Relative risks

While there continues to be headline after headline about the nuclear power plant that received the brunt of an historic earthquake and tsunami, such things as Japan’s effort to find the bodies of 12,000 missing citizens and other disaster recovery efforts take a back seat.

The debris created by the tsunami is massive with Hawaii and California anticipating large islands on their shores due to ocean currents. Another aspect of that debris is the subject of a story at CBS News: Asbestos, Japan tsunami’s other hidden danger.

Inside the chunks of slate and wallboard smashed and scattered by Japan’s tsunami hides a health risk that has been overshadowed by contamination from a leaking nuclear plant: the odorless and nearly invisible threat of asbestos.

Activists have found the cancer-causing, fibrous material in the air and debris collected from the devastated northeastern coast.

Activists? Now the anti-nuclear activists are fading and the asbestos activists are rising?

The honest perspective is a rationale assessment of risks. The nuclear risk is easily detected, contained, and localized. The risks from the debris field of the tsunami are much the opposite as they are widespread, poorly defined, and often difficult to detect. The clean-up effort not only risks harm ranging from direct injury to infection like tetanus from stepping on a nail, they also face biological and chemical hazards.

Meanwhile, most headlines are on the paranoia side, i.e. nuclear, where there has been no death or illness, and the tens of thousands dead and the massive clean-up effort with its risks just gets an occasional mention. There is a warning here for those seeking reality.

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Anything for a tool: The risks of policing

Despite what you may have read, it’s safer to be a police officer today than it has been in 35 years. [Balko: The “War on Cops” That Isn’t]

Incidents where police are shot are being used as tools in a debate. The idea is that there is a war on cops, that there are too many guns on the streets, that there is a rising anti-police sentiment, and that the smaller government ideologues have gone too far.

But what is the reality? Remember the Dirty Harry movies and the 70’s domestic terrorism?

In fact, the number of on-the-job police fatalities has dropped nearly 50 percent in the last two decades, even as the total number of cops has doubled. According to the National Law Enforcement Officers Memorial Fund, 279 cops were killed on the job in 1974, the worst year on record. That number steadily decreased to just 116 in 2009.

The leading cause of death for cops on duty is car accidents, not violence. … data from the Bureau of Labor Statistics indicate that policing isn’t among the 10 most dangerous occupations in the country, let alone “the top five,” even if you include traffic accidents.

Despite rising gun ownership and declining shootings, some still assert a “pressing need to revisit the conversation on gun control.” — they never give up no matter the reality.

But the media love a good scare story. For police organizations, seizing on an anomalous series of shootings as evidence of cop hatred can transform the debates over such issues as funding for police departments, aggressive police tactics, police militarization, the use of Tasers, searches and pat-downs, and police transparency and accountability. Don’t be misled. The safety of police officers is important, but it should not come at the expense of the safety and civil liberties of the people they are sworn to protect.

There are very many issues based on police that need examination. Using the tragedy of a shooting in order to promulgate ideas that don’t mesh well with reality is a tragedy in itself because they drag the attention away from these other issues. These include methods for assuring accountability in policing, the problem of the use of police for other social activity such as revenue enhancement and social welfare, and the matters of responsibility in community security.

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The art of caving: lawyers yield to political extortion

John at Powerline says it is “One of the saddest stories in the news today.”

Jennifer Rubin states the case succinctly: “The left decides who gets lawyers.” She cites chapter and verse on the left’s support for lawyers who defend unsavory clients, as long as the issues involved are not dear to the hearts of liberals, like gay marriage.

When the expression of an opinion does not recognize civility, as has been demonstrated recently in such things as public employee union protests, it can easily cross lines into improper persuasion via implied threat.

When a major law firm like King & Spalding puts politics above its duty of loyalty to its client, it is a sad day for our profession and for our country.

That is because the voice of reason succumbs to the expression of power.

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Fomenting the politics of hate

It happens anytime budgetary constraint becomes the topic of debate. This time around, there is anticipation for the usual tactics. That anticipation is already realized in this early stage of the debate. Lloyd Brown describes the situation.

Those who have not been as successful will be urged to hate the people who have worked hard to get an education, get a job, and master the job skills that get them promotion and raises. They have saved their earnings and provided for their retirement.

It will be difficult to hate them individually, because they are not the same people from year to year. More than half of those in the “rich” category are not there the following year.

Nevertheless, liberals will portray their hard earned wealth as ill-gotten gains, taken from some mysterious pile of wealth that in a world where “economic justice” reigned would be divided equally among all Americans. (See: Communism, 1917-1989.)

Play the victim card. Find someone to blame. It helps of that someone is a part of a group with a rather hazy definition such as ‘the rich’ or ‘speculators’. Tell the people they are victims of these evil and despicable folks who aren’t paying their fair share and are out to kill, starve, or harm the poor, the sick, and the unfortunate. Promote envy and hate and other negative emotions.

Such tactics require a people who do not look at history, do not consider the implications, and dwell on their own selves without consideration of others. The consequences are not pretty.

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The modern socialist manifesto

It is a list of demands. Walmart is being asked to enter a contract to agree upon a list of demands for their Washington D.C. stores. Mark Perry says
Walmart “Gets Served” By DC Community Group.

The stipulations run the gamut from a living wage ($12.50 an hour) to transit benefits ($50 per employee per month) to parking minimums (up to 2.5 free or low-cost spaces per 1,000 square feet of building space).”

Perhaps a key item in the list is that about firearms and ammunition. Nearly everything else is about payment to support workers and competing businesses.

There is no item that is about the benefits the community will receive by having a retailer like WalMart set up shop in the community. These are proven benefits but they are not within the control of government – except inasmuch as ‘community groups’ can promote laws, regulations, and taxes that inhibit and limit and control – and perhaps chase away – businesses that can provide growth and prosperity to a community by competency in the marketplace.

One can look at D.C. sans Walmart and compare to neighborhoods that have welcomed the retailer and then wonder just what it is that D.C. really hates about WalMart.

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Easter: trying to make sense out of it all

If ever there was a situation that had profound impact but also created significant cognitive dissonance, the death and resurrection of Christ has to be it. Mark Shea takes a look at the efforts to rationalize what is known in If Christ Has Not Been Raised: The Case for the Resurrection.

One of the obvious difficulties with all these theories is that they don’t fit together well. If later generations are to blame for importing Resurrection myths, then earlier ones aren’t. If it’s all Paul’s fault, then it’s not Peter’s. If the Eleven are body snatchers, then they’re not well-meaning hallucinators, and vice versa. Such theories demonstrate what C.S. Lewis once referred to as the “restless fertility of bewilderment” so much in evidence when debunkers try to overturn the mountain of solid evidence for the truth of the Christian claims.

When such concepts as Occam’s razor or the ‘keep it simple stupid’ are applied to the circumstances, what is left puts quite a strain on Sherlock Holmes assertion that “Once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth.”

The Resurrection is the factual cornerstone of Christian faith. Without it, you do not get a Gospel purified of superstition. You get a litter of low-rent “real” conclusions to the story of Christ that are vastly harder to buy than the Christian explanation. At the end of the day, the fact remains that “if Christ has not been raised, then our preaching is in vain and your faith is in vain” and “we are of all men most to be pitied” (1 Corinthians 15:14, 19). But that never seemed to worry Paul, for “in fact Christ has been raised from the dead, the first fruits of those who have fallen asleep” (1 Corinthians 15:20).

The impossible and the improbable seem to be the same event. It does indeed seem good ground for a “restless fertility of bewilderment.”

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About that population of poor people in the U.S.

The meme is to tax the rich because they are greedy and don’t deserve it and the gap between rich and poor is growing and so on.

Besides the problem that there is a limit as to how poor you can be but not on how rich you can be, there is the reality of just what being poor means. One rundown on this is poor, but with a cell phone and a car that cites James Taranto at the WSJ who cites a 1990 Heritage Foundation report for reference.

“Poor” Americans today are better housed, better fed, and own more property than did the average U.S. citizen throughout much of the 20th Century. In 1988, the per capita expenditures of the lowest income fifth of the U.S. population exceeded the per capita expenditures of the median American household in 1955, after adjusting for inflation.”

That was twenty years ago. Have things regressed so the poor are poorer. Not according to the Census Bureau. A large part of this growing wealth of the poor is the advances in technology, such as cell phones, and innovation in manufacturing and distribution as shows up in WalMart prices.

Remember the days when telephone service was a party line and long distance required an operator and deep pockets? Things have changed.

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Ideological construct to explain opposition?

Steve McIntyre notes what he calls an ideological construct. It is the rationalize of an effective opposition as being in the grips of moneyed interests.

As readers know, this characterization of Climate Audit and other critical climate blogs (WUWT, Jeff Id, Lucia, Bishop Hill) is total fantasy on the part of the climate science community. It seems to me that the fantasy is an ideological construct that they use to avoid looking into the mirror.

The reason McIntyre considers it a fantasy is that the major players he names are all independent, retired, avocational, or academic. That sort of thing does not make any impact as can be seen the depths to which they will go to make some link, any link, between these irritating skeptics and ‘big oil’ or other corrupt influence.

It is a hallmark, this ideological construct, that can be easily seen. That means it is also a good metric for determining that an ideology has over-run reality and reason.

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Solidarity in religion?

Dennis Prager wonders why don’t Christians help Christians? He relates the story of Jewish solidarity regarding the oppression of Jews in the USSR as a contrast to the silence about the persecution of Christians.

In the Muslim world, Christians are being murdered, churches are being
torched, entire ancient Christian communities — the Iraqi and
Palestinian, for example — are disappearing. And, again, 2 billion
Christians react with silence.

The Pope has spoken against the Muslim war on Christians but it doesn’t seem to have made much of an impact in Christian churches in Europe or the U.S.

The time may come when silence will be insufficient.

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shame on the Nevada Conservation League

For an example of how ugly the ‘debate’ can get, a Nevada Conservation League provides the material. It is a personal attack on Congressman Dean Heller regarding the EPA. the NCL radio advertisement accuses the Congressman of advocating for dirty air and water as if he is intentionally out to cause human suffering and grief. In the process, they toss in the ‘evil corporations’ buying legislative influence meme.

What the NCL illustrates is irresponsible citizenship. They do not clarify just what specific legislation or issue is of concern. Instead, they jump to conclusions only tenuously connected to purported legislative actions; they attack their opponents with absurdities (unless you think elected representatives deliberately want to cause grievous health problems in their constituents); and toss in unfounded allegations and conspiracy theories.

The major problem with such irresponsible citizenship is that people have generally assumed they mean well and are correct in their basis. The pattern of a lack of intellectual integrity and a common set of questionable behaviors may be used to qualify that assumption so that that the citizen and voter can find the underlying reality and make responsible decisions.

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Modern casual conspiracies

Conspiracy theories have a rather bad reputation. That is because they are often simply a lazy way to rationalize some phenomena with an ideology without having to confront the difficulties of a complex reality. One example of the common modern conspiracy was offered by Chad Orzel.

this strikes me as a case where the community potentially has a great deal more power than is usually the case when negotiating with major industries, and industry is to a large extent trying to keep them from realizing it.

Community power! Evil industry (even better than corporation as it is a group of big evil corporations)!

The topic in this case is the extraction of methane from deep shale deposits that is done by fracturing the rock. To avoid tapping this resource, after the promulgation of a conspiracy theory to hold the public ignorant, two facts are offered. One is that the stuff won’t rot so we don’t need to go after it now. The other is that the supply is finite so it should be saved until it is really, really needed and extraction methods become cheaper and less risky.

These ‘facts’ are appealing but they are simplistic. Many natural resources are, of course, finite, but that doesn’t mean that they are just tapped until gone. As illustrated in this methane shale example, new reserves are continually found and new methods are developed that make it more cost effective to tap resources that could not be tapped before. It is the cost versus demand in a broader market that controls the flow.

The false choice is defined as that of a government – in this case the community governments – knowing more than the market or the business and being in conflict with those entities. The problem here is seen in the fact that the carbon (as in CO2 and global warming) issue is tossed in. That is a problem because the certitude of the conclusions is out of line with that of the data. Costs, benefits, and risks are not a part of the discussion. The government does not know all and a lot of what it knows is not matched with any accountability mechanism in the manner that businesses and markets are. Governments are even bigger than those big evil corporations or even the ‘industry.’ That means its errors are also bigger which is why they so often yield catastrophic results such as war or social collapse.

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Religion: it’s complicated. but not for some.

What is religion? Why does it exist? What purpose does it serve? Why does it often seem so tied in with the base of conflict?

People do seem to want to know exactly what they should do and how they should behave. They want concrete and simple answers to all matters of life. But reality doesn’t often fit with what makes sense. Trying to make sense anyway is what religion is all about.

April is a celebration of several events of religious significance and takes note of some of the different ways religions deal with answers by suggesting that Christianity Is Not a Tucked-in-Tight Religion.

Islam offers lots of definite answers, but Christianity takes after Christ in leaving some questions on the table and often offering stories rather than formulas. Don Everts and Doug Schaupp, in I Once Was Lost (IVP, 2008), state that “Jesus is asked 183 questions in the Gospels. He answers just three of them—and he asks 307 questions back.”

The type of questions is also significant. Quranic questions tend to be rhetorical or hectoring: “Do they not know that Allah knows what they keep secret?” (Sura 2:7). Christ’s questions probe: “What do you want me to do for you?. . . How do you read the law? . . . What are you looking for?”

It may be that complexity, questions without definitive answers, lead to an intellectual habit of seeking further to find truth. That habit may be one reason why Western Cultures based on Christianity have yielded continual advancement in intellectual ideas and learning. That has also yielded continual advancement in health and welfare to the point where it has become a topic of envy and self guilt. Those feelings, in turn, may stimulate a desire for simpler answers and other nonproductive outlets – like terrorism.

But if you want more than a series of statements and more than a book of rules about what we should and should not do, then read the Bible and understand it as a story of what God did for us. Christ is risen. He is risen, indeed.

Is your life simple? Or is it complicated? How do you deal with it? Advance or retreat? Fortify or explore? Accept or deny?

On a related note, consider the plight of Bill Calhoun at a town commission meeting. He thinks the prayer before the meeting is a violation of the Constitution. The Commission unanimously agreed to the prayer and more than 500 people at the meeting erupted in cheers. “I’m here to tell you that Christians are fed up with being the fall guy for every person in this country,” Military veteran Joe Quinn of Lady Lake said.

Reaction, response, and simplicity complicated it is.

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47% of the vote so far to ‘tax the rich’ – is it fair?

One of the talking points in budget discussions is that any problems can be solved by eliminating the “Bush tax cuts” and implementing other means to increase the tax burden on the rich. This is a simplistic view that does not stand even a basic scrutiny but there are reasons to suspect it has weight.

Brad Schaeffer describes Tax Day And The Future Tyranny Of The Non-Taxed. He notes that 47% of US households will pay no income tax for 2010. This is up from 40% five years ago. At this trend, more than half the voters’ vested interest in regards to federal income taxes will be in what they get, not what they pay. That is one definition of a voting block with a significant common interest.

Statistics vary slightly but it can be argued that the top five percent of US households pay 60% of federal income tax. Ten percent account for over 75%. Another two-fifths make up the rest. And half are exempt. And yet…twenty percent of US households get 75% of their income from the federal government. Another one-fifth receives 40% of their financial support from Uncle Sam. Think about what this means in terms of fiscal responsibility down the road. How receptive to cutting taxes which they do not pay, or cutting government spending, from which they benefit, is a majority voting block going to be in the future? Indeed, what does this say about our prospects for economic growth or curbing the size and scope of an ever growing government colossus in the face of a crushing $20 trillion deficit looming on the horizon?

Very soon we may not be merely de-incentivizing economic activity but actively waging war on it.

The issues are about what is a fair share for the ‘rich’ to pay in support of government. The numbers regarding wealth represent a skewed distribution because there is always room to be more wealthy but there is a limit to how poor one can be. With economic growth, that gets into the dialog about the growing gap between the poor and the rich as if one should cap wealth to be ‘fair’ with the inherent limitations on poverty. The tax situation, though, is analogous to a basic marketing law matching income to demand and product price.

The idea often heard as a means to increase government income is to simply raise taxes. The problem is that raising taxes is like a business raising the price of its goods. Up to a point, income increases but after that point the price discourages buyers and the total income decreases. With taxes, too, government income will increase up to a certain level but after that, economic activity is depressed and the overall tax revenue decreases as there is less activity to tax.

Businesses don’t usually consider fairness and such philosophical ideas as major factors in setting prices. They can let the market and competition handle most of that. Governments are an entirely different matter. They exist not to maximize revenue but rather to maximize social goals like defense and justice. That makes issues of fairness much more important. If more than half the vote does not contribute to the federal income tax, that half has a choice to confront: Is it fair to depend upon someone else for government?

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Modern socialist foundational belief: expressed.

Isaac Bailey provides some interesting insight into the sort of thinking that is foundational to modern socialism. The title, Commentary: Civil War wasn’t so simple provides the first clue as it is oxymoronic – representative of the reduce to the absurd logical fallacy.

Then there is the class warfare loaded with envy: “as you examine the motives of the wealthy landowners who started a war that killed 620,000 Americans, don’t overlook the precarious predicament poor white farmers faced in 1861.”

And what has been overlooked for too long is that there are thousands of Southern white families mired in poverty begun during slavery. It’s one of the ironies of that period, that black slaves and poor whites were more damaged by slavery than others and could have provided a formidable opponent against the wealthy slave owners who benefited the most. But race got in the way, just as it often does today.

The celebrations to mark the 150th anniversary of the firing on Fort Sumter also gets its snark. The meme is that war is terrible and is not celebrated by those who are in touch with reality.

It doesn’t have to be that way, not if we all embrace some realities many of us would rather ignore.

Another ‘reduce to the absurd,’ this time with rationalization is tied in with the slavery ethos often used to castigate the U.S. while ignoring the broader context of slavery in human affairs.

Critics of Confederate sympathizers are right to complain that those sympathizers too often paint a rosy, overly romanticized version of history by claiming the South didn’t go to war to preserve slavery – even though the leaders of the Confederacy told us in speeches, official government documents and letters that was the reason they left the union.

What is striking is the idea of using an assertion of complexity to spout socialistic talking points and then ignoring the actual complexity. The differences in cultures – agrarian versus industrial, for example – would be prime territory for the socialist. The problem was that the side with the evil corporations won the war. Then there’s the problem of why ‘the poor’ volunteered and conducted the war. Using complexity as a club rather than explore the nuances of human endeavors is not a path to truth.

The commentary has a contrast also published this morning. The roots of racism describes the same sort of basic phenomena as Bailey.

It’s one thing to display a susceptibility to stereotypes, as George Allen seemed to do recently when he asked a black male newsman, “What position did you play?” It’s something else again to voice support for the legal strictures of the Black Codes and Jim Crow. One would have thought the foundation on which such laws were erected would have crumbled long ago.

Then again, maybe not. Because the mentality of anti-miscegenation relies on some intellectual habits that are still very much with us.

Beyond the boundaries of Mississippi, flagrant racism might have fallen out of favor. Its underpinnings, alas, have not.

Those underpinnings are the same as those that claim to look at the complexities of the war between the states and see only slavery and class warfare.

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A sea of numbers that all seem to tell different stories about the same thing

You may have heard about the 38 billion dollar deal that the CBO says was only 380 million? What’s the fuss?

Budgets and numbers seem appropriate on April 15. The deal and the CBO thing is somewhat like cash versus accrual that you choose when making business reports to the IRS. Bruce McQuain has a good rundown on why The $32.5 billion in cuts are real cuts.

All of these things are important. Removing the budget authority essentially defunds a program, or, as mentioned, stops it in its tracks and removes the money from being available to the program being defunded. It also removes it from the grasping, greedy fingers of bureaucrats ready and eager to take whatever money they can get their hands on and spend it.

This is also related to some of the ‘end of year’ spending where departments make sure to use up their budgets allocated for the year so as to not cause people to think its budget can be reduced next year.

What has happened is that some project and activities that had money set aside, but not yet spent, were canceled. The 380 million is about money that was being spent. The 38 billion is about money that was promised and set aside but not yet on the line.

The importance of the budget deal is that it resets the debate. Prior to this point, the term “cuts” has often been used to refer to a reduction in growth. Now it is being used to actually refer to reductions in the actual amounts being spent. The rate of growth in government spending has exceeded that of the economy and that resulted in financial stress. If that rate of growth can be held to below the rate of growth of the economy, that stress will be relieved over time. If the rate of growth of government can be stopped or even made to go towards a smaller government, then the climb out of current debt and obligations will be more assured to occur at a faster clip.

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Indirect expressions of ideologies

US News provides a nice example of an indirect expression of an ideology in the 6 secrets of cell phone carriers. It all sounds so consumer friendly and is useful information so how could there be any bias?

First is the logical fallacy (popular voice) used to rationalize the reason for the article.

Raise your hand if you hate your cell phone carrier. If your hand is in the air, you’re not alone.

Next is the traditional caveat emptor – with a gotcha’.

The key to unlocking savings is knowledge. We need to know what the cell phone carriers know in order to negotiate fair deals and avoid spending money unnecessarily. By having a few pieces of valuable information, we can level the playing field. So here are six secrets cell phone carriers don’t want you to know.

So what’s the deal? Take note of the presumptions. The title talks about the business having “secrets” to harm its customers. Then there is the idea of victims being able to “level the playing field.”

The focus is on out-gaming those evil corporations out to victimize the little guy. That is an ideological bias. An alternative bias would take the point of view that the ‘little guy’ has the power in his hands expressed by purchase decisions and can choose between many vendors to express his power.

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Data mining in a new age

Bloomberg tries to describe why this tech bubble is different. There are very many implications uncovered in the basic idea that there is a tech bubble based on how to generate click-through ad revenue on websites. Here are a few.

1) mathematics education and ‘why learn math’ – the basis of the technology is in the minds of those who can handle quantitative analysis – the super-gifted in mathematics and statistics. This is the talent not only needed to determine how to create websites with good advertising returns but it is also the skill being used to find terrorists by the military.

Eric Schadt, the chief scientific officer at Pacific Biosciences, a maker of genome sequencing machines, says new-drug discovery and cancer cures depend on analytical tools.

2) the privacy issue online – One the one hand are the companies selling ID theft insurance and legislation attacking web browser ‘cookies’ while, on the other hand, people are joining social community sites to bare their souls and have everything they do and say carefully monitored and analyzed.

Facebook has since turned these insights into precision advertising, the foundation of its business. It offers companies access to a captive pool of people who have effectively volunteered to have their actions monitored like so many lab rats.

3) the anti-business ideological conflict – modern socialism is contemptuous of capitalism and considers advertising as a mental forcing mechanism to cause people to buy whether they want to or not. That appeals to many, especially the younger idealistic set whose number includes some of those mathematically gifted individuals doing the data mining in order to find ways to make advertising more effective and manipulating the user mindset.

Ultimately, ad-tech companies are giving consumers what they desire and, in many cases, providing valuable services. Google delivers free access to much of the world’s information along with free maps, office software, and smartphone software. It also takes profits from ads and directs them toward tough engineering projects like building cars that can drive themselves and sending robots to the moon. The Era of Ads also gives the Wants something they yearn for: a ticket out of Nerdsville

What is missing shows in the bias in the article and its attempt to fit a phenomena into a shoe that might not be a good choice. To call a marketing technique a “tech bubble” that is going to burst like the tech bubble of the turn of the century or even the housing bubble a few years ago is rather a stretch. Marketing always involve exposing people to things they want and that means knowing those people so you can figure out what they want. People will always be seeking goods and services because even food and shelter are goods and services. Quantitative techniques in marketing is simply a matter of having the right tools to make it practical and useful. Once those tools have been invented, both in terms of hardware as well as software, they won’t go away. They will be, and have been, built upon.

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whither science?

Willis Eschenback takes apart an interview of Professor Muller of the Berkeley Earth Surface Temperature (BEST) project by NPR. What is revealed is about the nature of science in modern society.

I wholeheartedly agree. I only fear that Muller doesn’t realize the full extent of the problem. I’m afraid he hasn’t noticed how that whole “we’re on a noble mission to save the world from itself” mentality has deeply infiltrated and corrupted an entire field of scientific inquiry.

I also found his comments on “pigeonholing” quite revealing. In the interview he divides people into “deniers”, “skeptics”, and “exaggerators”, and discusses what he sees as the characteristic claims of his neatly pigeonholed groups … and then he claims he doesn’t like pigeonholing?

The picture raised is that of a scientist trying to please an ideology in vogue and having problems with his intellectual integrity in the process. It is a struggle which is endemic in the nature of scientific inquiry. Eschenback’s story provides a good illustration about why it is an important struggle.

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