Open Thread

This is our monthly place to discuss topics that have not appeared in recent posts.

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  • What should I know about life insurance?

    A few days ago I was approached by an Alico agent offering life insurance.

  • nelsonal

    The basics are: it’s useful to have some after you’re married with a house or have kids, since presumably your spouce depends at least partially on your income to support the house and/or kids.

    However, there are two major types of insurance, term and whole life. Term is insurance as an individual product, whole life is insurance combined with a savings plan. The savings plan is especially useful in the context of estate taxes (which is one reason Warren Buffett is constantly agitating to raise taxes). Whole life is vastly more profitable for insurance companies so they spend almost all their sales effort selling it (most term insurance is sold consumer pull rather than salesman push).

    Pricing for life insurance is usually based on age and health (many insurance plans for individuals require a very comprehensive physical).

    A final unique thing about insurance is that you can buy it from what is effectively a savings co-operative or mutual company where policyholders are owners.

  • IVV

    What is the value of sovereignty?

    On the surface, it’s about the ability to harvest resources from a place or population, but, say, why wouldn’t Greece sell off some islands to another country? Or to a third party to found a new sovereign land? Why is nationalism so important?

    • France sold the Louisiana Territory to the US, and Russia similarly sold Alaska. The Maldive islands are going to drown with the global warming-based rise of sea level; that country is looking to buy land elsewhere to relocate its population.

      Exceptions aside, I suspect this is just a matter of power. The leaders of the country control their land; the more land they have, the more power they have. Everyone wants more power.

  • Panu Horsmalahti

    I would be interested in information about women’s sexual power, e.g. how men want more sex than women, and what kind of resource transfers this enables for women (a typical example is that men have to initiate everything, have to pay for the dinner in a date etc).

  • Long term unemployment is quite perplexing. I have heard that in the 1930s there were people called decaders who were unemployed for 10 years. How can unemployment persist? The price should fall to were you can get employees really cheap. Does signaling have a role? People do not want to work for low pay because it sends a bad signal?

    • Robert Koslover

      How can unemployment persist?

      Well, here are just a few possibilities to ponder.
      1. Repeated extensions/bailouts to unemployment compensation — i.e., “if you reward something, you will get more of it.”
      2. Minimum wage laws prevent wages from falling to meet market conditions. Like it or not, for people with low skill sets, their current worth/hour in the market is less than the minimum wage.
      3. Unions have negotiated rules and regulations that make hiring Americans clearly unprofitable when compared to moving/operating businesses overseas instead, where labor is cheaper. For example, the cost of providing health insurance is an enormous fraction (and an often seemingly-hidden part) of the total cost of employing someone in an otherwise low-wage job.
      4. Just like unemployment compensation programs, food stamps and a plethora of welfare programs reduce people’s motivation to find work or to accept lower salaries than they believe they deserve. Fear of genuine starvation, freezing to death outdoors, etc, really are powerful motivating forces, painful as they are to contemplate. We simply don’t have much of those fears anymore (for better or worse) to induce people to seek, and accept work in, unpleasant jobs.
      5. Government policies (and the uncertainty about them) seriously discourage entrepreneurs from risking capital and hiring employees.
      6. Government’s clear and blatant failures to uphold the rule of law (specifically, established contract law) in high profile cases (e.g., the GM bailout of unions at the expense of non-union creditors who were legally entitled to compensation first) strikes genuine fear in the hearts of would-be investors in business ventures. If they can’t count on written contracts being enforced by the Government, then their risks are (obviously) much higher. Note that the same effect reduces the desire of businesses to invest in countries like North Korea, Libya, Venezuela, etc, where laws are enforced (or not) at the convenience of the despots there.
      7. Complying with environmental rules and regulations, whether good for Mother Earth or not, and well-intentioned or not, almost always add real costs to doing business. Once again, by making it more expensive to do business in the USA relative to other countries, we shift jobs to those other countries.

    • Robert Koslover

      Oops, I forgot to mention:
      * High taxes on business. Business leaders are not fools — they will relocate to places where taxes are less, when practical. For example, many businesses are moving out of California right now (where business taxes are high) and moving to Texas (where business taxes are low). Likewise, unemployment is higher in California than in Texas.

    • Matt Flipago

      Well it’s possible that begging and scavenging the trash can be more profitable then getting a job. You don’t need any government assistance for that to happen.

    • kevin

      It is pretty simple. The price floor for wages (minimum wages) prevents the market from clearing. Of course, even without a minimum wage, there would still be unemployment as long as there were sufficient income transfers to the unemployed. (These income transfers include voluntary charity and transfers from friends/family).

  • Nathan

    Lately I’ve read quite a bit about the uselessness of public education.

    In two years I’m going to be teaching in the public school system, at an elementary level. The students I’ll be teaching will be quite cognitively impaired, they will never graduate from college or run a business.

    For those opposed to public schooling, what would you say to people who are about to start a career in it?

    What do people think about programs for students with special needs?

    • fructose

      I wouldn’t say public education is “useless”. Public education is a presumably useful to somebody.

      Public education is useful for preparing students for a lifetime of taking orders from strangers with authority (this is crucial for industrial societies). It also gives kids great practice in asking those in authority for permission before taking any action, even things like standing up, or going to the bathroom. Another benefit is that it makes children think of learning as boring, repetitive, and painful, which makes them hate learning (and thus, makes them easier to control).

      Another huge advantage is that, since it traumatically separates children from their families while extremely young, it weakens the natural favoritism people show for family members, and realigns loyalty to “society”. This is why countries with a long history of public education are much less corrupt than those with closer family ties. Of course it probably also results in the cultural/social catastrophe of a “youth culture” obsessed with popularity, sex, and physical dominance.

      And of course, public education is useful for you! You’ll never be out of work! You get 3 months off every year! You’ll make more than the average private sector earner, retire in 20 years, and never have to work again!

  • Virtually Anonymous
    • Panu Horsmalahti

      If it’s effective, why not? Anyway, in this case that doesn’t seem to be good public relations.

  • josh

    Under what conditions does the human institution of science more likely to mislead than to point toward truth?

    Lysenkoism produced false official truth, which was a hell of a bias to overcome.

  • candy

    Suppose there was an effort to design the successors to humanity, and you were given the task of choosing which features they would have (possibly also deleted features if these beings are modified humans).

    In what ways would their psychology differ from present-day humans? What kinds of things should they want? Should they be capable of the same emotional states? What mental capabilities would you emphasize?

  • Rebecca Burlingame

    Perhaps one of the main problems with K-12 education is that it doesn’t really prepare the student for any kind of life in his or her own community. Instead the student is encouraged to believe in making a life for oneself by leaving upon graduation, to search for wherever the better future supposedly is. The lives we want, we should be able to create wherever we are. Some developing countries are making the same mistake and losing the ones they try so hard to teach, from their own communities.

    I’d be willing to bet that even if some of your students can’t run a business, they can still find plenty of ways to be responsible to themselves and to others. They are like everyone else in that they just want to be a part of what is going on, and willing to try to make that happen.

  • vozworth

    is the belief of global warming a luxury good?

  • Jonas

    I just read an article about the Russian search engine Yandex (they hold 65 percent of the market share in R.). They are currently developing a traffic information system for Moscow that is updated in real-time.
    Here is a link of how this will look like:

    I was wondering what you think about this.

    Will such a system for cities advance the traffic flow, or will it get more chaotic due to reflexive processes? What I mean is that it could be disadvantageous if too many people change their behavior simultaneously according to the real time updates.

  • OhioStater

    Hypergamy writ large.

  • Cyan

    This webcomic made me think of OB.

  • Erisiantaoist Greg Egan’s latest work of fiction includes a less than complimentary appearance from Robin Hanson.