Slow Friday: Random Thoughts

Storage Wars

I will be shocked if this show produces even the slightest bit of enjoyment for me in my lifetime. Even accounting for quantum uncertainty, I will say unequivocally it will be zero. Nonetheless, I'm forced to hear several commercials for it every day due to their radio advertising campaign. During their standard spot, the advertisement claims that every day over 10,000 abandoned storage units are sold to the highest bidder.

It's hard to have an intuition about large numbers which we can hardly understand. Compounded with the fact that the workings of the public storage market is far from a topic of interested, I would be very understanding if my intuition led me wrong here. However, doesn't this just seem like a ridiculous number?

Census.gov estimates that in 2010 there are 114,825,428 U.S. households. Of them, data suggest that 1/11 own storage units. That would imply that we have 10,438,675 storage units in the country. If 10,000 are auctioned off everyday, that would mean we see 3,650,000 sold off per year. This then accounts for 35% of the total storage units in the country. 35% of all storage units become abandoned/foreclosed upon? That seems a tad ridiculous, even for a country struggling with numerous economic problem. In the worst counties in the country we have a home foreclosure rate of less than 1%. Certainly homes rank much higher on one's priority list and face a far lesser chance of being unfunded, but still something seems fishy about this to me.

These estimations are rough at best. The 1/11 of households ratio could be slightly misleading. I assume it was calculated by dividing storage units by number of households, but it could just be the ratio of families owning at least one storage unit to total families. This would make the numbers more favorable, but I'm inclined to say BS on this one. Or is my intuition just flawed?


Black Holes

It's pretty obvious why physicists are in love with black holes. The public at large too tends to love things that are mysterious or those that offer all the interesting aspects of a hard science without all the hard work. Black holes in the popular science realm satisfy both of those categories. This said, perhaps part of their appeal comes from the human fascination with death?

We don't know what happens inside a black hole. We have lots of theories, but no consensus. All we know is that the physical world as we know it ends. The laws of physics breakdown. It's a completely different kind of place.

The event horizon appears to be a mundane thing. You can't see it. You can't measure it. When you pass through it, you won't even know it happened. However, once you do nobody on the other side can ever reach you. This is a poor explanation, but since I've started studying them it's a connection which is constantly in my mind.

Social Security: A Creative Solution

2010 Social Security beneficiaries will not receive a cost of living increase.

Before all you grannies forcibly dependent on government retirement get your panties in a bunch, please realize that this non-action represents a gain for retirees. You see, over the past year we bore witness to a period of negative inflation. Thus, constant payment rates result in a net gain in terms of purchasing power.

I heard this story on the radio this morning while commuting to work. The otherwise rainy day became instantly brighter. I nearly had to pull over to fully enjoy the hardy laugh this story deserved. We've experienced a negative inflation rate?

During the 20th century, the economical sciences experienced a change in nomenclature. Inflation used to refer to an increase in the money supply. This is often derogatorily referred to as the "traditionalist" definition. The term was replaced by a pair of terms: monetary inflation and price inflation. Monetary inflation took on the meaning of the "traditionalist" definition while price inflation referred to an increase in the overall price level.

As one of their many astute observations, the Austrians recognized the superfluous nature of the price inflation definition. Price inflation follows inevitably from monetary inflation. Calling the cause and the effect by two separate names only obscures the link between them. Any attempt to combat the former while ignoring the latter will be doomed to failure.

Under the Austrian/Traditionalist definition, one can not think of a more eggregiouis lie than to claim a negative inflation rate from 2009 to 2010. Although official M3 data has not been released for political reasons, currency numbers, M1, M2, and the Rothbardian TMS have all exploded in the last year. We already have inflation. Prices may be momentarily held down, but the inflation is here.

Unsurprisingly, government tends to manipulate price inflation numbers in their favor. As powerful as semantic manipulation may be, nothing confuses a government educated populace like cold hard numbers. So enters the CPI as a measure of price inflation. Besides the futility of examining price inflation rather than monetary inflation, CPI provides easiest means for the state to change data in the shadows. To quote the Bureau of Labor Statistics: "The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services." Without going into messy details, the problem with this as a scientific definition comes when we try to define a "market basket". The elusiveness of this term allows governments to easily mask inflationary expenses. If agricultural prices are experiencing positive velocity, simply remove agriculture from your measured basket and replace it with another commodity. Measurable inflation? No problem, just change your basket goods. The ball is in the government's court. They know what to do with it.

So here we have government's solution to Social Security. The system is bankrupt. Everyone knows this. How do we reduce the costs? We simply redefine inflation. We change our CPI basket. To hell with reality, reality can't compete with the handy, easily referenced numbers provided by the CPI. It's quite easy to erase growing costs when you can keep them from growing while convincing the public they're not losing anything.

The real secret about social security isn't that the system is going to fail. It is that the system has already failed. It's insolvent. It's time to move past unsustainable government promises, and back to reality and personal responsibility.

A Traveler's Dilemma: Dilemma?

The Traveler’s Dilemma describes a situation which is seen as somewhat of a paradox by game theorists and economist. Loving a good supposed paradox, I became interested in it after reading a cursory mention in a footnote. After reading the problem, I certainly realized the troubling gap between the game theoretic solution and the common-sense solution. I must examine the literature further on this to see some proposed fixes. This blog isn’t about that though. Often times, when translating technical mathematical statements into easily digestible colloquial speech, the actual mathematical result is oversimplified and loses its meaning. I think a bit of that is occurring here. Let’s look at the dilemma.

Two passengers are returning to the United States from abroad. Upon departure of the plane, the passengers realize that incompetent TSA workers, after invading their privacy and searching their bags, had caused the destruction of an antique had purchased outside the country. The two antiques were identical. The passengers file a claim form with the government seeking compensation. Now the TSA’s claims department, being too lazy to do proper research, does not know the true value of the antique. However, they have a plan. They tell each passenger to write down a value on their claim form between $2 and $100. If both passengers write down the same number x, they will each be rewarded with $x. If two different numbers are claimed, call them m and n (assume m < style="">, the lower value m will be taken as the true value. Being social engineers as the government is one to do, it is decided that the "honest" passenger claiming m, will receive $(m+2) as a reward. The "lying" traveler will receive only $(m-2), with $2 taken away as a punishment. Now, what value should the passenger claim?

Upon my first reading, I naively answered “however much the souvenir cost”, completely missing the paradox. Ditching any sense of morality then, how much should we claim thinking only of our gains? Did you answer $100 dollars? Or a value close to it? You naïve layman with your feeble reasoning skills. The game theoretic solution tells us that each passenger should claim $2, which we denote by (2,2).

The strategy (2,2) is what’s called a Nash Equilibrium. In this sense, we call it a solution to the problem. The paradox manifests itself here since we would intuitively be able to reach a much higher gain by simply claiming a higher price. Yet game theory tells us (2,2) is optimal. A Nash Equilibrium has the property that neither party can improve his gain by unilaterally changing his strategy. To see this assume the first traveler claimed $2 and the second claimed any value other than $2, so that we have (2, y>2). Then, by the game parameters, $2 will be the accepted value. Traveler 1 will gain the $2 value, plus his $2 truth bonus for $4. Traveler 2 will receive $2 minus his $2 penalty for no gain. Similarly, the strategies (x>2, 2) would yield unfortunate results for Traveler 1.

Part of the communication breakdown comes from the meaning of optimal in the vernacular and as a technical definition. In regular speech, an optimal solution would mean the best possible solution. In Mathematics, what we mean is that the strategy will maximize a player’s minimum gain (or equivalently minimize the maximum loss). Claiming $2 clearly does this, as it guarantees a gain of at least $2. Claiming any other price leaves open the scenario where the other player claims $2 and you gain nothing. Keeping this in mind, the solution becomes much less puzzling. It is only a solution in the sense that, assuming some conditions about known information and rationality, it meets a narrow technical definition of what properties we desire in a solution.

Nash equilibriums are helpful when there’s a threat of your opponent outplaying you. If a Nash Equilibrium exists in a given game, you equalize the playing field by employing one. For no matter how outmatched you are by an opponent, you force him into also playing the Nash Equilibrium, essentially removing the skill disparity. In this situation, a Nash Equilibrium may not be the strategy we wish to employ.

I’ll close with one final thought. When we speak of optimal or best solutions in regular life, the closest game theoretic analogue (which I know of at least) is the dominated strategy. We say Strat A dominates Strat B, when the payoff from Strat A is greater than or equal to the payoff for Strat B, regardless of what strategy the opposing player chooses. To give an example: Suppose one is playing Texas Hold’em. On the river you hold a Royal Flush, and your opponent bets into you. You then have three strategy options: Fold, Call, or Raise. The strategy of raising dominates all other strategies. For no matter what cards your opponent holds and no matter how your opponent responds, you will gain more from raising than you do by either calling or folding. Domination is a strong criterion than Nash Equilibrium and rarely applies in real games. Notice that in the Traveler’s Dilemma , no strategy dominates any other. As an example, claiming $2 does not dominate claiming $100 dollars, since the payoff for (2,100) = 2 < 100 =" (100,100).

Marriage: Why?

Why does marriage as we know it exist? I can hardly think of a more ridiculous and asinine institution. There are many activities which go completely unquestioned by the American public. Marriage is a major one. As happens in far too many debates, the public discusses two sides of a topic, both of which rest on an underlying assumption which is never mentioned. As Ayn Rand was often fond to point out, both political parties suffer defeat because of the axioms they swallow without questioning. The wrong question: What groups of people shall we allow to wed? The right question: Why should government have a say in marriage?

There exists thorough documentation of the changing conception of Western marriage from its time as a method of social engineering by totalitarian governments, to a spiritual bond between two individuals, to sexual/spiritual bond between man and women, to its highly contested state now. Often, the volatile realization of the concept has been used as a justification for the allowance of gay marriage. The other side responds to this attack with appeals to morals and essentially a structural fundamentalist social philosophy exalting the preeminence of the family. The debate itself is interesting enough, but it is not the one we should be having.

Why need government sanction marriages? First consider the functions of a marriage. Essentially it constitutes a contract between two consenting individuals concerning ownership of assets and rights of visitation. There is no need for this particular contract to be enforced separately under the moniker of marriage. It may be handled like any other contract in our legal system. Indeed, those choosing to be marriage in a religious/spiritual sense could do so and be free of any legal entanglements. The only potentially troublesome aspect of this view of marriage comes as a result of the complete ineptitude of the income tax code. The federal income tax disgusts me on many levels. It should not exist. If it is to exist however, it certainly should not be a means of providing incentives or disincentives for particular behaviors the government is fond of at the time of its writing. Quite simply, remove the income tax or remove this particular moronic provision of the code, and we may safely move forward with “private” marriages.

How would the two most prevalent sides of our marriage debate react to this?

Religious people should not be troubled by this. Surely, government sanctioning of marriage should be completely irrelevant, as the sacrament of marriage is a bond between man and wife witnessed by God. Government approval should be completely foreign to the equation. In fact, the religious should be insulted that government claims some stake in marriage. Government cannot oppose God, nor can it bend his will. Any attempt for it to do so should be seen as an affront to its true nature.

Homosexuals, polygamists, and the incestful should rejoice. They would be free to enter into the same contracts as heterosexual, monogamous, unrelated couples. Since no marriages at all would be of interest to government, there would be complete marriage equality under the law. The ugly age of marriage exclusion in the United States would end.

In reality I doubt the scenario would play out as ideally as it would in a rational world. Statism runs deep. The religious in particular are guilty of using the government for their whims. Having their conception of marriage exist is not enough for some religious folk. It must be the only such option. The desire to dominate all too often intertwines itself with creeds that preach submission to a higher power. Throughout history religions have allied with government to swell their numbers and spread their accepted behaviors. Those in favor of non-standard marriage would also likely reject this. Marriage as a government institution is sacrosanct. People have a sick need for government to validate their choices.

The current system is disgusting. Government has no authority to sanction marriage. It’s just a further example of the undeniable tendency of government to spread its insidious grasp over the daily minutia of our lives. It’s insulting. It’s degrading. It stifles basic freedoms. The solution to the tired, biased debates on the subject sits easily and immediately right in front of us with the change costing us nothing. However, as happens constantly, it will never even be discussed by our politicians. Anyone suggesting it would be laughed at as a nut or feared as a radical. It’s a shame. As long as government holds its ground, no side of the debate will be happy.

Dumb Laws

Most of us at some point have stumbled over to DumbLaws.com or at least heard snippets of its content. The website exists not for any informative reason, but instead to entertain us. We see these arcane laws as reflections of a quaint time in our nation’s past. It amuses us to discover that such laws could ever be enforced or even enacted. But should the appropriate response be humor? Is something more insidious present in these laws than mere naivety? And why do we so easily laugh at past legislation without blinking an eye at our current laws?

Consider some of these ludicrous examples:
- Dominos may not be played on Sunday.
- It is illegal to sell peanuts in Lee county after sundown on Wednesday.
- It is illegal for a driver to be blindfolded while operating a vehicle.
- Motorized vehicles are not to be sold on Sundays.
- If you’ve been convicted of drinking and driving you may not apply for personalized license plates.
- You may not slurp your soup.

After reading through some examples one begins to notice a few trends which we may generalize. The laws attempt to legislate morality, are too specific and clearly reactionary, or involve the state trying to protect us from ourselves (really just a subset of legislating morality). What we laugh off as dumb laws we should really despise as tyrannical laws. In all of these cases we see a legislature reaching beyond its proper functions. The humor comes easily when they’re viewed as relics of the past, but we must be open to the reality that people were prosecuted under such laws. The gentlemen handed fines and subject to court appearances for slurping their soup would hardly find the law to be humorous.

It may seem silly to refer to such seemingly minor laws as tyrannical. Surely, the punishments for such infractions were not debilitating and were seldom enforced even that the time of their passage. However, we should not stay our outrage on those grounds. Minor injustices are still injustices. Further, dumb laws leave the door ajar for seriously despotic laws to arise. Once legislatures claim the ability to impose their morality and way of life upon us in principle, they will not hesitate to do so in action. Our overseers forbid us to sell automobiles on Sunday to keep their Sabbath holy, and we begrudgingly accept without serious complaint. When we do so, we accept their premises and give validation to their methods. Then we stand flabbergasted as violent video games are swept from store shelves and homosexuals are forbidden from entering into marriage. We must realize that the acceptance of one leads to inception of the other.

What then are the dumb laws of our age? I’m amazed at the hypocrisy of our elected officials who would scoff at the laws in the DumbLaws.com archives and turn the next day to vote against medicinal marijuana. The great body of laws forbidding personal drug use constitute the dumbest of the dumb laws we’re forced to abide by today. We suffer through the needless prosecution of these laws which will one day be laughed at as relics of a past, simpler, society. I hope however the situation is slightly different. I hope that instead of humor our descendents look upon them with disgust. Instead of laughing their blood should boil at the audacity of a government drunk on power, subjugating its people to slavery under meaningless, unjust laws. I hope that they remember the billions of dollars spent, the thousands of lives lost, and the hundreds of thousands of poor souls who had to rot in prison or pay a fine just to feed the appetite of a legislature’s bloody crusade for their morality.

To all of the victims of dumb laws past, present, and future, I’m not laughing.

Obama: Muslim in Disguise?

A recent pew research poll shows that 18% of Americans believe that Barack Obama adheres to the Muslim faith. Perhaps more shockingly, 43% confess to not being certain of what religion the man follows. These polls reflect increased American uncertainty about the president in wake of the mosque “at” ground zero controversy. Suddenly the question of Obama's true faith seems even more pressing than it had in times past. Conservative media outlets are attempting to use this to whip the public into a illogical fervor about the president's secret Muslim beliefs. Liberals take the defensive, insisting that the conservatives' conclusions are rash, unfounded, and almost exclusively political in nature. Once again both political parties share an identical ideology, surrendered to arguing about the mere petty details.

This situation unequivocally demonstrates to us the wholesale acceptance of collectivism by our dominate political parties. Never is the question asked in the public discourse: Why does it matter? If the public were even to entertain this question it would shake the establishment to its core. Both parties require that the masses' minds remained mired in a primitive sort of tribalism. People must be regarded as soulless vessels filled only with the meaning that their respective labels grant to them.

The Republicans rely on this mentality, despite their supposed defense of individual liberties (how can they exist without acknowledging the individual?), most importantly to support their agenda of perpetual war and the justification that produces for the usurpation of civil liberties. With a rational view of mankind, the wars in Iraq, Afghanistan, and soon to be Iran, would not be supported by the public. However when individualism is eroded away and replaced by the identity “Muslim”, these wars become instantly justifiable. Muslims are at war with the United States. Muslims are terrorists. Muslims want to destroy our freedom. The equating of “Muslim” with “terrorist” combined with the a collectivist mentality provides the necessary foundation for the Republican platform of perpetual war, a police state, and crony capitalism.

I don't wish to suggest that Democrats aren't equally at fault in this context. One need not look further than any Democrat's opinion of capitalism or big business to see this. However, their faults are outside the scope of this post.

To the question of Obama's religion I give the response: Who cares? Certainly not me. And unfortunately we will not see a free America until the majority holds my position.

Healthy Government

With recent talk of a "soda tax" in Philadelphia and pundits warnings/support of further government intervention in American dietary habits due to its increased place in health care, I've been thinking a lot about F. D. Roosevelt and one of his pets, the Agricultural Act of 1938. Why is that?

The more one begins to perceive the workings of our government, the more one sees plain as day the complete philosophical bankruptcy of our leaders. Our politicians meander through life as jackals preying on the public and working to fatten the purses of themselves and a few close friends. Our government shows no consistency and frequently outrightly contradicts itself.

Although taxation as a means to curtail undesirable behavior should be recognized as evil and a hallmark of despotism in itself, such goals are too lofty at this stage. However, most can probably agree that government should not jointly penalize unhealthy behavior in one domain and subsidize it in another. Unfortunately government has been partly doing this for years.

Ever walk around the supermarket and wonder why all the cheapest items are so bad for you? You can get an economy sized pack of fudge cookies for the same price as a bunch of bananas. This stems largely from governmental policy. Junk food consists mostly of sugar which is dirt cheap in our country. But raw unprocessed sugar has a hefty tariff imposed on it (not for any health reasons only to protect inefficient domestic producers), so these sweet products are produced using High Fructose Corn Syrup.

This brings us back to FDR and his cronies Henry Wallace and Rexford Tugwell. Passed under the guise of relief (somehow farmer prosperity and farm prices were linked to overall economic health in a series of poorly manufactured causal chains) the Agricultural Adjustment Act of 1938 included federal subsidies for six "basic crops": corn, wheat, tobacco, cotton, rice, and peanuts. In reality the bill was a payoff to huge farm lobby in return for political support. As Economist Donald Paarlberg explains,

"The top 1% of farmers got 21% of the benefits. ... Left out of the program were more than 100 other crops... More, in fact, was left out than was included. The politically influential basic crops produced only about 20% of the industry's income but received 75% of the program benefits."

Relief indeed. This farm bill continues until this present day with benefits being renewed every 4 years without much debate. Notice the content of those basic crops? Not exactly the health conscious person's preferred list of goods. Just looking at recipients of the subsidies in PA we have some startling numbers. In 2009, only 28% of PA farmers collected any form of farm subsidy. In addition, 10% of our state's farmers collected 58% of the subsidies totaling 868 million since 1995.

Corn subsidies in that time frame? 640 million good for the top spot of all subsidies received. In the top 10 there's not all that much I can say promotes good obesity fighting health. Soybeans totaled 96 million and apples 12 million some 17% of the corn expenditures.

So before we talk about a "soda tax" maybe we should talk about subsidies. These expenditures are not necessary and subsidize unhealthy eating. Of course most politicians lack the logic to see the problem in pursuing both courses of action. And any plea to a common health argument is all smoke and mirrors meant as a feeble justification for any new gorging scheme our benefactors intend to impose on us.

(As a side note some studies suggest that HFCS may contribute to increased appetites and body fat compared to sugar. The jury seems to still be out, but it's worth noting)

Cafeteria Greenery

When I'm in the cafeteria I enjoy having the luxury of using a tray to carry my various plates and drinks to my seat. However this decadent luxury has been revoked by the fine people at Aramark for the unassailable reason of saving the environment. Naturally given their intentions I have no grounds upon which no complain, and no argument to offer against their noble crusade. As napkin holders tell us (now housing 100% dye free recycled napkins) not having trays allows us to save the environment by saving water and soap while reducing food waste caused by trays. The fact that trays cause food waste is undeniable as shown by objective statistics compiled by Aramark using the grand sample of one day of food waste from our University (details such as the control, data gathering process, etc are unnecessary). And the atrocious wasting of non-replenish-able natural resources such as soap and water speak for themselves.

Who believes this facade? Without even trying to compare the inconvenience of making four trips just have a meal with the carbon footprint associated with washing a 18"x 12" piece of plastic, can anyone take this seriously? This whole ploy, like most "green movements", is just designed to save money and not doing a damn thing for the environment. If the company could just be upfront and say "We're cutting simple commodities in an attempt to reduce costs and keep prices fixed.", I would actually respect their decision. As it is I'm just annoyed. Even if they were telling the truth, the result would be a negative one. If research would be spent on more reasonable things, eventually technological advances will come along which will lead to safer environmental practices. Look at Poland Spring. In attempt to reduced costs they find an optimized design for their water bottles which maximizes volume while minimizing surface area. As a result their bottles use less plastic. Here we see a technological advancement helping the environment, while providing no discomfort to the consumer. Aramark removes trays, slightly improving the environment, and greatly annoying the consumer.

Politicians and Their Logic

I was reading a LA Times article today published after the ratification of the sixteenth amendment and I came across a quote I just had to share with the nobody people who will read this. This piece of wisdom comes from long former Tennessee representative Cordell Hull:

"One of the important results on an income tax will be a curbing of unnecessary federal expenditures. When a great part of a government's income is derived by direct tax upon the citizens of the nation, they will scrutinize more carefully the appropriations made by congress."

To which of course the only appropriate response is lol or perhaps a rofl. Now I don't believe that Hull actually spoke such absurd words truly meaning them; I'm sure he was giving his best Billy Mays to the public trying to push ratification. Apparently he did a good job making people think giving a government more power as a means to curtail power is a good idea. Given America's mental dependence on the federal income tax as a sacrosanct, eternal fixture of our law, it seems the idea really took.

Of course the amendment was a long time coming after the tax's first "necessary" establishment during the Civil War, but still that idea that all but 6 of the then 48 states voted for ratification a mere 137 years after the revolution amazes me.

What bothers me the most is how anyone who attempts to bring the morality or necessity of the federal income tax into public debate is automatically labeled a nutcase and instantly discredited. How did we come so far?