Tag Archives: Regulation

Peter Doherty on Variolation

Two noteworthy media mentions of variolation:

1. The New Yorker features Douglas Perednia talking about controlled infection and variolation, as its Exhibit A on on why conservative media shouldn’t presume to write on health/medicine, as they will only say stupid obviously terrible things:

After the Federalist tweeted it out, Twitter, which has been cracking down on coronavirus misinformation, temporarily locked the Federalist’s account. … He’d submitted it to a number of medical journals and blogs. “They all turned it down with no comment,” … tried the Federalist, almost at random. … The site accepted his article the next day, no questions asked. …

On the site … most commenters found Perednia’s idea absurd, dangerous, hilarious, or all three. … many angry e-mails and calls … Andrew Lover, an assistant professor of epidemiology at the University of Massachusetts-Amherst, told the Times that Perednia’s article was “exceedingly ill-advised and not evidence-based in any way shape or form.” …

Perednia [said] the way to adapt his idea to this reality was to make sure that the infecting was done with ‘the lowest possible dose’ … a concept known as variolation—which, he thought, would cut the death rate among those who chose to take part. (more)

2. A month ago, Adam Ford interviewed me on voluntary infection. Yesterday, Ford posted his interview with Nobel laureate Peter Doherty, author of Pandemics (2012), wherein Ford asked Doherty about variolation. Here are selected quotes from that discussion (fuller quotes below the fold):

47:10 Ford: “Controversially, in leu of actual vaccine that could come, hopefully in 9 months, but maybe even in 18 months if things go okay, if social isolation doesn’t work well enough too, would something like strategic or voluntary small dose low dose infection, like variolation, work in order to gain immunity, or nudge herd immunity? Is that something that we should be considering?

Doherty: (laughing) “Well let’s tell people what variolation was. … What they did was do this in young children, young children had a good immune response, generally survived smallpox, so what they were doing essentially is giving them smallpox, and they survived, whereas if they got it when they were older, they’d have a much worse disease. … So its not an unthinkable thing. …

52:40 With Covid19 I don’t know, but it would take a brave soul to be a test candidate, With younger people who are not severely affected, it’s possible. But you’d have to be enormously careful that they didn’t get any dose through their nose. But there would be ways of doing this. …

53:40 Ford: Is this something that could be achieved in the near term, if the vaccine timeline ends up looking like its going to be longer?

Doherty: If it was an absolutely catastrophic situation, if it was like the situation that is depicted in Contagion, where everyone who is within 100 feet of the virus gets it and dies, yes it could be reasonable. But I think for a virus where 80+% of people are definitely mildly infected at worse, or not sick enough to go into hospital, I don’t think you would take risk of that. The thing about a vaccine is that you have to give it to large numbers of normal people. You can’t take risks with vaccines.

You can take risks with end stage therapy. If someone is very very sick, and you’ve got something you think might work, you can try it pretty easily. People will approve that, … But you can’t take risks with vaccines. And the magnitude of the severity of this threat is not great enough to do that. You could say, … we’ll take a vaccine that looks a bit risky, maybe, and we’ll give it to the elderly. These are the people who are at risk, they can try it. … People like me, say would volunteer, I certainly would. I’d give it a go, and see if that works. But I wouldn’t want to be giving a vaccine that had any risk at all to younger people. You know, these are all theoretical arguments. But there is no way anything is ever given to anybody in this sense without going through extremely thorough review processes. … I think it is pretty unlikely.

So Doherty accepts “variolation” as a term that applies outside the context of smallpox. He thinks it could work, but oddly seems to see the main concept as infecting the young, rather than controlling dose, delivery vector, or strain. And he sees it only as justified in extreme circumstances, which Covid19 will never be, as it isn’t deadly enough. Even if the Great Suppression crashes the economy worse than the Great Depression, and even if millions will likely die from accidental infections, in his eyes and those of regulators that’s no excuse for letting healthy people voluntarily take substantial personal risks. Continue reading "Peter Doherty on Variolation" »

GD Star Rating
loading...
Tagged as: ,

Do You Feel Lucky, Punk?

A recent influential report posed the key Covid-19 issue today as: to mitigate or suppress? Should we focus on “flattening the curve” under the assumption that most everyone will get it soon, or adopt even stronger measures in an attempt to squash it, so most never get it.

Some simple obvious considerations are:

  1. if successful, squashing saves many more lives,
  2. you have to do a lot more to squash than to flatten,
  3. while flattening policies need be maintained only for a few months, squashing policies must be maintained until a strong treatment is available, probably years, and
  4. squashing is far easier when you have only a few infected and when your trading, travel, and physical neighbors don’t have many infected.

Several nations, mostly Asian, seem to have successfully squashed so far, though they started when they had few infected. China and perhaps S. Korea are the main examples of squashing more than a tiny number of infected, though even they had far fewer than we do now in the West where so many are suddenly eager to squash. China had much recent experience with mass surveillance, controlling population movements, and enforcing strict rules. Even so, they screwed up badly early on, and it isn’t at all obvious that China’s squashing will keep working as they let people go back to work, or when many big neighbors get highly infected.

The main point I want to make in this post is that trying to get your Western government to suppress Covid-19 in the usual way is making a big bet on the quality of they and typical neighboring governments. And also of your public’s commitment. As in the famous Dirty Harry (non-)quote, I ask: “Do you feel lucky, punk?”

Western government agencies and expert communities so far have had a bad record dealing with Covid-19. At first they criticized China’s strong measures and focused on signaling political correctness. The US government badly screwed up the generation and regulation of tests and masks, and the West continues to fail to cut regulation preventing rapid expansion of medical personnel and resources. Western governments only changed policies when public opinion changed, and even now seem more focused on handing out cash to allies, and symbolic but useless acts like banning bicycles.

As with most policy, you must expect that the details matter a lot. So even if you see China policy as a success, you shouldn’t have high hopes if your government merely copies a few surface features of China policy. That only works if this is a simple problem, with simple solutions, and few problems are that simple. This is not just a problem of insufficient moral fervor.

You should have higher hopes if they copied the whole China policy package relatively exactly, and even higher if the Chinese officials who managed their policy implementation personally came to manage implementation here. Even then climate, cultural, or infrastructure differences might mean their policies don’t work here. But no government seems even interested in copying the exact China package, and in my recent poll, 80% of 927 opposed this last idea of Chinese management.

Dear Western citizen, your government has already demonstrated incompetence at dealing with this in the absence of public pressure, and public pressure will mainly push them to do what they guess they would be most blamed by the public for not doing if things go badly. Regardless of whether that actually works; the public may never learn what actually works.

This pandemic has already been allowed to get much bigger than any that has ever been squashed before, and it is harder to squash than most, passing via the air, living on surfaces for days, and with infected folks showing no symptoms for over a week. And in contrast to China, your government doesn’t have much recent experience with the mass surveillance, movement controls, and strict rule enforcement.

And yet now at this late date, you are considering if to authorize these same governments to oversee not just large efforts to flatten the curve, but the more extreme efforts required to squash it. Even knowing that to make it work you’ll need very strong public support in a far less-communal culture than those that have so far managed to squash.

Mind you, you are now considering this not because you have great confidence in your government’s competence, or your public’s support. But mostly, it seems, because it would look morally bad for you to give up hope on the millions who will die even if we flatten the curve well. Really, do you feel lucky, punk?

Also consider: even if your local government manages to successfully squash its internal infections temporarily, what happens if half of its neighbors fail, and become mostly infected? Or what if they succeed for a while, but half of their neighbors fail? What will it take to keep external infections from overwhelming you then? Or what will it take for your government and others to coordinate to ensure that most governments succeed? Remember, these are the governments who have so far largely failed to prevent massive illegal immigration, and who continue to fail to coordinate to limit global warming, war, and ocean overfishing, or to promote global innovation.

This wouldn’t matter much if the policies for squashing looked much like the policies to flatten, so we could actually flatten but pretend for a while that we were trying to squash. But there are policies that could help to flatten that look obviously bad for squashing, such as deliberate exposure, which might cut 3/4 of life-years lost. And locking down the economy and social contacts for many years at a level that looks at all like it might succeed in squashing is going to involve enormous costs to the economy and your freedoms.

In my recent polls, 73% and 74% of 393 and 533 respondents predicted US and world (respectively) will become >25% infected before an >80% effective treatment was given to >80% of world. So 3 in 4 agree that global containment just isn’t going to happen. Yet, to show that they care, most governments are giving lip service to squashing as their goal, not flattening. How far will we all go in paying huge costs to pretend that this is at all likely?

Before we all jump off this cliff together, can we at least collect and publish some honest estimates of our chances of success? Such as perhaps via conditional betting markets? If you aren’t willing to exactly copy the whole China policy, or have them manage it, how serious could you really be about succeess?

Look, this is like starting a war. Its not enough to ask “would it be nice to win such a war”; we also need to ask “can we actually win?” Don’t start what you can’t finish.

I fear suppression is a monkey trap; afraid to let go the nut of saving everyone, we’ll be trapped in the gourd of not saving nearly as many as we could have.

Added 20Mar: Note that the many responses defending suppression talk about how many lives could be saved, and how they can imagine a plan that would work, but none address the issue of how competent is our government to implement such plans. Amazing how easily people slip from “it could be done” to “my government could do this”.

GD Star Rating
loading...
Tagged as: , ,

For Fast Escaped Pandemic, Max Infection Date Variance, Not Average

In an open column, … to provide greater dispersion, the vehicle distance varies from 50 to 100 meters, … distance between dismounted soldiers varies from 2 to 5 meters to allow for dispersion and space for marching comfort. (More)

The troop density has decreased through military history in proportion to the increase in lethality of weapons being use in combat. (More)

Armies moving in hostile areas usually spread out, as concentrations create attractive targets for enemy fire. For soldiers on foot, it might be possible to try to induce such dispersion by having a vicious wild animal chase them. After all, in the process of running fast to escape, they might spread out more than they otherwise might. But this would be crazy – there’s no reason to think this would induce just the right level of dispersion, and it would have many bad side effects. Better just to order soldiers to deliberately space the right distance. 

For a very infectious pandemic like COVID-19, clearly not contained and with no strong treatment likely soon, the fact that medical resources get overwhelmed toward a pandemic peak creates a big value in dispersion – spreading out infection dates. But, alas, our main method is that crazy “chased by a wild animal” approach, in this case chased by the virus itself. 

That is, each person tries to delay their infection as long as possible, in part via socially destructive acts like staying home instead of working. Like soldiers running from a wild animal, our varying efforts at delay do create some variance as a side effect. But probably less than optimal variance, and at great cost. 

Yes, delay has some value in allowing more stockpiling. For example, we should (but apparently aren’t) mass training more medical personnel who can function in makeshift ICU tents. But increasing average delay is can be less valuable than increasing delay variance. Even if we can’t just tell each person when to get infected, like telling soliders where to walk, we have several relevant policy levers. 

First, as I’ve discussed before, we might pay people to be deliberately exposed, and covering the cost of their medical treatment and quarantine until recovery. Yes, if their immunity has a limited duration, then we might want to not start deliberate exposure until there’s less than that duration before the pandemic peak. But there’s still big potential value here, especially via targeting medicine and critical infrastructure workers. 

Second, this is a situation were inequality of wealth, health, and social connections is good. In the last few years, many have loudly lamented many kinds of social inequalities that make the low feel ashamed and unloved, resulting in their more often becoming lonely and sick. Some are enough friends and money that they can afford go to all the parties, while others suffer in poverty alone. And no doubt many will cry loudly when such inequality makes the low get infected before the high.

But however bad such inequality might usually be, in a pandemic it is exactly what the doctor should order, if he could. Among a community close enough to share the same medical resources, the more that individuals vary in their likeliness of catching and passing on the pandemic, the better! Those who catch it early or late will do better than those who catch it just at the peak.  So for this pandemic, let’s maybe back off on whatever we now do to cut inequality, and maybe even open up more to whatever we are not doing that could increase inequality. 

In my next post, I’ll describe some simple concrete sim models supporting these claims.

GD Star Rating
loading...
Tagged as: , , ,

Defrock Deregulation Economists?

Recent economics Nobel prize winner Paul Romer is furious that economists have sometimes argued for deregulation; he wants them “defrocked”, & cast from the profession: 

New generation of economists argued that tweaks … would enable the market to regulate itself, obviating the need for stringent government oversight. … To regain the public’s trust, economists should … emphasize the limits of their knowledge … even if it requires them to publicly expel from their ranks any member of the community who habitually overreaches. …

Consider the rapid spread of cost-benefit analysis … Lacking clear guidance from voters, legislators, regulators, and judges turned to economists, who resolved the uncertainty by [estimating] … the amount that society should spend to save a life. … [This] seems to have worked out surprisingly well … The trouble arose when the stakes were higher … it is all too easy for a firm … to arrange for a pliant pretend economist to … [defend them] with a veneer of objectivity and scientific expertise. …

Imagine making the following proposal in the 1950s: Give for-profit firms the freedom to develop highly addictive painkillers and to promote them via … marketing campaigns targeted at doctors. Had one made this pitch to [non-economists] back then, they would have rejected it outright. If pressed to justify their decision, they [would have said] … it is morally wrong to let a company make a profit by killing people … By the 1990s, … language and elaborate concepts of economists left no opening for more practically minded people to express their values plainly. …

Until the 1980s, the overarching [regulatory] trend was toward restrictions that reined in these abuses. … United States [has since been] going backward, and in many cases, economists—even those acting in good faith—have provided the intellectual cover for this retreat. …

In their attempt to answer normative questions that the science of economics could not address, economists opened the door to economic ideologues who lacked any commitment to scientific integrity. Among these pretend economists, the ones who prized supposed freedom (especially freedom from regulation) over all other concerns proved most useful …  When the stakes were high, firms sought out these ideologues to act as their representatives and further their agenda. And just like their more reputable peers, these pretend economists used the unfamiliar language of economics to obscure the moral judgments that undergirded their advice. …

Throughout his entire career, Greenspan worked to give financial institutions more leeway … If economists continue to let people like him define their discipline, the public will send them back to the basement, and for good reason. …

The alternative is to make honesty and humility prerequisites for membership in the community of economists. The easy part is to challenge the pretenders. The hard part is to say no when government officials look to economists for an answer to a normative question. Scientific authority never conveys moral authority. No economist has a privileged insight into questions of right and wrong, and none deserves a special say in fundamental decisions about how society should operate. Economists who argue otherwise and exert undue influence in public debates about right and wrong should be exposed for what they are: frauds. (more)

Oddly, Romer is famous for advocating “charter city” experiments, which can be seen as a big way to escape from the usual regulations.

So how does Romer suggest we identify “pretend” economists who are to be “exposed as frauds” and “publicly expelled from economists’ ranks”? He seems to say they are problematic on big but not small issues because firms bribe them, but he admits some are well-meaning, and doesn’t accuse Greenspan of taking bribes. So I doubt he’d settle for expelling only those who are clearly bribed. 

That seems to leave only the fact that they argue for less regulation when common moral intuitions call for more. (Especially when they mention “freedom”.) Perhaps he wants economists to be expelled when they argue for deregulation, or perhaps when they offer economic analysis contrary to moral intuitions. Both sound terrible to me as intellectual standards.

Look, people quite often express “moral” opinions that are combinations of simple moral intuitions together with intuitions about how social systems work. If they are mistaken about that second part, and if we can gain separate estimates on their moral intuitions, then economic analysis has the potential to produce superior combinations.

This is exactly what economists try to do when applying value of life estimates, and this can also be done regarding deregulation. The key point is that when people act on their moral intuitions, then we can use their actions to estimate their morals, and thus include their moral weights in our analysis.

In particular, I don’t find it obviously wrong to let for-profit firms market drugs to doctors, nor do I think it remotely obvious that this is the main cause of a consistent four-decade rise in drug deaths.

Yes of course, it is a problem if professionals can be bribed to give particular recommendations. But in most of these disputes parties on many sides are willing to offer such distorting rewards. My long-standing recommendation is to use conditional betting markets to induce more honest advice from such professionals, but so far few support that.

GD Star Rating
loading...
Tagged as: , ,

Firms & Cities Have Open Borders

Cities usually don’t much limit who can move there. If you can find someone in a city to give you a job, to rent you an apartment, to sell you food and other stuff, and to be your friends, etc. and if you can pay for your move, then you can move to that city from anywhere in a much larger region. Of course individual employers, landlords, and stores are mostly free to reject you, but the city doesn’t add much in the way of additional requirements. Same for other units smaller than a nation, such as counties and states.

Large firms also don’t usually much limit who can work there. Oh each particular small work group is usually particular about who works there, but the larger firm will mostly defer to local decisions about hires. Yes, if the larger firm has made commitments to trying never to fire anyone, but to always find someone another place in the firm when they are no longer wanted in any one part, then that larger firm may put more limits on who and how many folks can be hired by any one small group. But when the larger firm has few obligations to local workers, then local groups are also mostly free to hire who they want.

The obvious analogies between cities, firms and nations make it somewhat puzzling that nations are much more eager to limit who can enter them. The analogy is strongest when those who enter nations can only do so in practice if they can find local employers, landlords, suppliers, friends, etc. willing to deal with them. And when the nation assigns itself few obligations to anyone who happens to live there.

Yes, in principle there can be externalities whereby the people who enter one part of a nation effect the enjoyment and productivity of people in other parts of a nation. But those same sort of effects should also appear within parts of a city or of a firm. So why don’t cities and firms work harder to limit local choices of who can enter them?

You might claim that cities and firms don’t need to attend to limiting entry because nations already do it for them. But most nations already have a lot of internal variation; why is none of that variation of interest to cities and firms, yet the variation between nations would supposedly be of huge interest, if nations were not handling that? And firms and cities within the nations that hold all those bad people that you think good nations are focused on excluding don’t have firm- or city-wide exclusion policies either.

Furthermore, many multinational firms today already have employees who are spread across a great many nations, nations that vary a lot in wealth, development, etc. Yet such multinationals usually don’t have much in the way of centralized limits on who can be hired by their divisions in different firms, nor on who can be transferred between such divisions. These firms may face limits imposed by nations, but they seem to mostly lament such limits, and aren’t eager to add more.

Firms and cities live in more competitive environments than do nations. So we should expect their behavior to be shaped more by competitive pressures. Thus we can conclude that competitive entities tend not to create entity-wide limits on who can enter them; they are mostly content to let smaller parts of them made those decisions.

So if nations act differently from firms and cities, that should be because either:
1) there are big important effects that are quite different at the national level, than at firm and city levels, or
2) nations are failing to adopt policies that competition would induce, if they faced more competition.

My bet is on the latter. In that case, the key question is: is there a market failure that makes the entry policies that competition pushes lamentable? If not, we should lament that competition isn’t inducing more free entry into nations. That is, we should lament that competition isn’t inducing national open borders, like we mostly have for cities and firms.

GD Star Rating
loading...
Tagged as: , , ,

Rules of Public Evidence?

The United States is perhaps unique among the developed world in that under law, some hate speech is protected. (more)

The United States has a very complicated system of evidentiary rules; for example, John Wigmore’s celebrated treatise on it filled ten volumes. James Bradley Thayer reported in 1898 that even English lawyers were surprised by the complexity of American evidence law. (more)

The main rules of evidence in Sweden are: (i) the principle of free evidence, meaning that there are basically no provisions on what is permitted as evidence as long as it is relevant to the facts to be proven in the case; and (ii) the principle of free evaluation of evidence, meaning that the court evaluates all evidence at its discretion. (more)

On 2 December 1766 Sweden became the first country in the world to have freedom of the press written into the constitution. (more)

Many in the US are proud that the US has weaker limits on speech than do most other nations, especially regarding political speech. However, most in US are not aware that the US also has some of the strongest “rules of evidence” limits on speech in legal courts. These US rules are new; we didn’t have them centuries ago.

Yet the usual arguments used to argue for free political speech can also argue for free court speech, while the usual arguments supporting rules of evidence can also support similar limits on political speech. And the examples of other nations shows that there isn’t a strong world consensus that court limits make more sense than political speech limits. Sweden shows that one can allow free speech in both contexts, while many other nations show that one can also have strong limits in both contexts.

Here are some common rules of evidence limiting trial speech. These are rough guides; the law is quite complex with simple summaries rarely applying exactly.

  • A big clear separation is required between “news” and “editorials”, that is between supporting evidence (most of a trial) and arguments for conclusions (given in closing statements).
  • All witnesses must swear oaths to tell the truth, and are guilty of a crime if they lie.
  • Anyone may be required to testify, except the accused, spouses, docs, therapists, lawyers.
  • One must apply any burdens of proof separately to each element, not just to overall evidence.

All these kinds of evidence are not allowed:

  1. The opinion of a non-expert, unless it is reached unconsciously,
  2. Unauthenticated tangible evidence,
  3. Indirect circumstantial evidence,
  4. Data on similar prior convictions or behavior by the accused,
  5. Hearsay, i.e., what someone heard someone else say,
  6. Simple “naked” statistical evidence, based on relative counts rather than direct observations,
  7. Extrinsic evidence of the contents of a written contract,
  8. Evidence obtained via illegal acts, and
  9. Confessions obtained in an “unreliable” context.

If we wanted, we could eliminate these court rules, and just let everyone say anything relevant that they want in court, as happens now in Sweden.

Or, we might instead apply many of these rules to public political speech. For example, we could require evidence and argument to appear in separate places, we could ban opinions by non-experts, and ban arguments using hearsay or naked statistical evidence. We might even ban irrelevant distracting tangents.

Such rules would require some discretion to enforce, but not much more than judges already use now to apply such rules in courts. Any disputes about excess or misdirected discretion would be judged by those very same legal judges who now make those judgments in courtrooms. And as with most law, minor offenses, which bring small sanctions, may be mostly ignored by both state police and by private suits.

Even in the US, we already apply many limits to business speech. For example, alcohol firms can’t tell the public that most studies find health benefits from modest consumption, anti-discrimination laws limit the kinds of questions one can ask in a job interview, professional licensing limits who you can pay for advice, and some offers are banned by blackmail and wrongful interference with relations rules.

The business world still roughly functions with these rules, as do political worlds in other nations that have strong limits on political speech. And courts could still roughly function without rules of evidence, as happens now in Sweden. These are clearly choices we could make, not clearly forced on us by survival or even wealth considerations.

So what should we choose, more free speech at trials, less free political speech, or a continuation of our inconsistent approach? Here’s a Twitter poll on that:

GD Star Rating
loading...
Tagged as: , ,

Let Foreigners Speak

In our ordinary informal lives of leisure, friendship, romance, and entertainment, we mainly regulate and mitigate the harms of speech with the option to use more speech. If we don’t like what someone says, we say something critical of what they said, or of them. We label, index, dissect, and evaluate, but we don’t ban or require any particular speech, other than via the incentives that our speech can produce.

However, as we move into the worlds of business and politics, we more often endorse censorship and forced speech. For example, regarding contracts, we allow lawsuits alleging fraud, and we require disclosure of safety info. Occupational licensing limits from whom you can get legal or medical advice. We let regulators forbid alcohol firms from making ads that say truthfully that teetotalers are less healthy than others, and require that firms disclosure financial info. We allow lawsuits alleging that slander hurt our business revenue, and require that everyone all carry valid ID. In politics, we require that donors disclose themselves, and we ban foreigners from direct participation in domestic election conversations.

It is worth remembering that most of the worse villains in history were famously far into censorship and required speech. The Catholic inquisition required people to agree with their dogma, and tortured and killed those who disagreed. US south slave owners beat slaves for speaking their minds, and prohibited teaching them to read. Nazi and communist regimes required public vows of allegiance, censored art and books, and punished dissidents. For centuries dictators have repressed dissidents, censored speech, and sought to control schools, newspapers, radio, and TV. Oppressive churches, firms, and other orgs have also sought to censor dissent and to require public agreement with their dogmas.

To me the obvious lesson from this history is to be reluctant to endorse banned or required speech; try as much as possible to solve speech problems with more speech. Yes, we might want to limit things like saying “fire” in a crowded theatre, but there’s a vast space of possible added speech solutions to explore, and we’ve seen a lot of innovation there in the last few decades. (Such as search engines and prediction markets.) It seems dangerous to empower some groups to decide what to censor or require; their first priority is too often to censor criticism of them and to require public agreement with them.

Traditionally US courts have declared themselves the most reluctant to regulate election-related speech, as they see promoting effective political competition as the core rationale for free speech. But lately it saddens me to see people especially eager to regulate political speech. People push for such regulation of politically-related “fake news” by our new mass-participation common-carriers like Facebook and Google, even though in past generations related common-carriers like telephones were especially prohibited from regulating political speech.

It also saddens me to see Trump critics focus most on cases where Trump encouraged foreigners to collect and distribute info on Trump’s political rivals. The focus of the Mueller investigation was Trump apparently encouraging Russians to find & distribute true dirt on Hillary Clinton. The focus of the current impeachment process is Trump apparently encouraging Ukrainians to find and distribute true dirt on Joe Biden.

I’m not especially a Trump fan, though I don’t intuitively loathe him remotely as much as so many do. And I understand that his critics see him as having done a great many quite blameworthy things. So it is sad to see this focus on foreign election influence, which will make it harder for us to adopt the global free speech norms that I prefer. I’d rather that everyone in the world was allowed and even encouraged to speak on everything in the world, including everyone’s elections. My reason is just the simple standard free speech arguments outlined above.

I can maybe see limiting the abilities of enemy combatants during wartime to make their case to our citizens that we should quit the war or that we are the morally guilty party. Though even here I’m not very convinced. But outside of war, I’d rather just let foreigners talk as much as they want to our voters. Yes of course they will have agendas they pursue in what they say, but that’s usually true of most everyone not only in election conversations, but in most all kinds of conversations.

Let the listener beware. Don’t believe everything you hear, and if you don’t like what others say, then by all means criticize it. But don’t outlaw it. Or require people to say the opposite. We just shouldn’t consider it treason or espionage to encourage foreigners to influence domestic elections by talking.  (It is fine, of course, to disapprove of assassinations.)

I can see the point of arguing that when a politician tries to negotiate to encourage particular speech, some kinds of pressures or incentives they might offer are legitimate, while others are not. But my understanding is that most backroom politics is largely about offering pressures and incentives to get people to go along with your plans, many of which are driven by selfish career agendas. It is not yet clear to me that Trump’s pressures and incentives in these foreign talk cases were greatly out of line with most politics.

But my main interest here isn’t Trump, it is foreign free speech. Let’s remember the larger lesson of speech in history, that the worst villains ever didn’t like it. So let us be wary of speech bans and requirements, and instead move toward letting everyone talk on everything, and fixing speech problems with more speech.

Added 11Oct: Alas, my Twitter followers don’t agree with me:

Added 13Oct: US law bans on foreigner participation in US elections.

GD Star Rating
loading...
Tagged as: , ,

Quality Regs Say ‘High Is Good’

95% think doctors should be licensed. … 96% oppose legalizing crystal meth. (more)

One of the main ways that our world is not libertarian is that it is full of government rules requiring minimum quality levels for many kinds of products and services. We see this for food, drugs, building codes, auto/plane rules, allowed investments, censorship, professional licensing, school accreditation, sports equipment, and much more. Once you look for them, you find such rules everywhere. So a key basic puzzle is: why do we have so many min quality rules?

Here are some clues to keep in mind:

  1. Though these rules limit consumer choices, they have strong voter support.
  2. Such rules were far less common in the ancient world.
  3. Today these rules are extremely widespread, across many areas of life and types of societies and governments.
  4. These rules are implemented via many channels: liability law, regulatory agencies, and legislation.
  5. Poor nations tend to have lower standards, like rich nations did when they were poor, yet we see few exceptions for poor people or neighborhoods.
  6. Product bans are far more common than are official quality evaluations.
  7. Many such rules are retained even when they seem quite ineffective, such as laws against vaping (little health harm), recreational drugs, and prostitution.
  8. We don’t make exceptions for customers who can show that they clearly understand that the product is considered low quality.

Continue reading "Quality Regs Say ‘High Is Good’" »

GD Star Rating
loading...
Tagged as: , ,

Libertarian Varieties

Here at GMU Econ we tend to lean libertarian, but in a wide range of ways. For example, here are two recent posts by colleagues:

Don Boudreaux:

The economy is an emergent and dynamic order that was not, and could not possibly be, designed – and, hence, that cannot possibly be successfully engineered. … the economy is not a device or an organization with a purpose. It is, instead, the result of the multitude of interactions of hundreds of millions of diverse individual entities – persons, households, firms, and governments – each pursuing its own purposes. …

Competent intro-economics professors keep their aspirations modest. In my case, these are two. The first is to impress upon my students the full weight of the fact that the economy is an inconceivably complex order of interactions that cannot possibly be engineered. The second is to inspire students always to ask questions that too often go unasked – questions such as “From where will the resources come to provide that service?” “Why should Sam’s assessment of Sally’s choices be regarded more highly than Sally’s own assessment?” “What consequences beyond the obvious ones might result from that government action?” And, most importantly of all, “As compared to what?”

Students who successfully complete any well-taught economics course do not have their egos inflated with delusions that they can advise Leviathan to engineer improvements in society. Quite the opposite. But these students do emerge with the too-rare humility that marks those who understand that the best service they can offer is to ask penetrating and pertinent questions that are asked by almost no others. (more)

I’m a big fan of learning to ask good questions; it is great to be able to see puzzles, and to resist the temptation to explain them away too quickly. However, I’m less enamored of teaching people to “ask questions” when they are supposed to see certain answers as obvious.

And the fact that a system is complex doesn’t imply that one cannot usefully “engineer” connections to it. For example, the human body is complex, and yet we can usefully engineer our diets, views, clothes, furniture, air input/outputs, sanitation, and medical interventions.

Yes, most students are overly prone to endorse simple-minded policies with large side effects that they do not understand. But I attribute this less to a lack of awareness of complexity, and more to an eagerness to show values; they care less about the effects of polices than about the values they signal by supporting them. After all, people are also prone to offer overly simple-minded advise to the individual people around them, for similar reasons.

Dan Klein:

Government is a special sort of player in society; its initiations of coercion differ from those of criminals. Its coercions are overt, institutionalized, openly rationalized, even supported by a large portion of the public. They are called intervention or restriction or regulation or taxation, rather than extortion, assault, theft, or trespass. But such government interventions are still initiations of coercion. That’s important, because recognizing it helps to sustain a presumption against them, a presumption of liberty. CLs [= classical liberals] and libertarians think that many extant interventions do not, in fact, meet the burden of proof for overcoming the presumption. Many interventions should be rolled back, repealed, abolished.

Thus CLs and libertarians favor liberalizing social affairs. That goes as general presumption: For business, work, and trade, but also for guns and for “social” issues, such as drugs, sex, speech, and voluntary association.

CLs and libertarians favor smaller government. Government operations, such as schools, rely on taxes or privileges (and sometimes partially user fees). Even apart from the coercive nature of taxation, they don’t like the government’s playing such a large role in social affairs, for its unhealthy moral and cultural effects.

There are some libertarians, however, who have never seen an intervention that meets the burden of proof. They can be categorical in a way that CLs are not, believing in liberty as a sort of moral axiom. Sometimes libertarians ponder a pure-liberty destination. They can seem millenarian, radical, and rationalistic. …
But libertarian has also been used to describe a more pragmatic attitude situated in the status quo yet looking to liberalize, a directional tendency to augment liberty, even if reforms are small or moderate. (more)

Along with Dan, I only lean against government intervention; that presumption can be and is often overcome. But the concept of coercion isn’t very central to my presumption. At a basic level, I embrace the usual economists’ market failure analysis, preferring interventions that fix large market failures, relative to obvious to-be-expected government failures.

But at a meta level, I care more about having good feedback/learning/innovation processes. The main reason that I tend to be wary of government intervention is that it more often creates processes with low levels of adaptation and innovation regarding technology and individual preferences. Yes, in principle dissatisfied voters can elect politicians who promise particular reforms. But voters have quite limited spotlights of attention and must navigate long chains of accountability to detect and induce real lasting gains.

Yes, low-government mechanisms often also have big problems with adaptation and innovation, especially when customers mainly care about signaling things like loyalty, conformity, wealth, etc. Even so, the track record I see, at least for now, is that these failures have been less severe than comparable government failures. In this case, the devil we know more does in fact tend to be better that the devil we know less.

So when I try to design better social institutions, and to support the proposals of others, I’m less focused than many on assuring zero government invention, or on minimizing “coercion” however conceived, and more concerned to ensure healthy competition overall.

GD Star Rating
loading...
Tagged as: ,

Fine Grain Futarchy Zoning Via Harberger Taxes

Futarchy” is my proposed system of governance which approves a policy change when conditional prediction markets give a higher expected outcome, conditional on that change. In a city setting, one might be tempted to use a futarchy where the promoted outcome is the total property value of all land in and near that city. After all, if people don’t like being in this city, and are free to move elsewhere, city land won’t be worth much; the more attractive a city is as a place to be, the more its property will be worth.

Yes, we have problems measuring property values. Property is only traded infrequently, sale prices show a marginal not a total value, much land is never offered for sale, sales prices are often obscured by non-cash terms of trade, and regulations and taxes change sales and use. (E.g., rent control.) In addition, we expect at least some trading noise in the prices of any financial market. As a result, simple futarchy isn’t much help for decisions whose expected consequences for outcomes are smaller than its price noise level. And yes, there are other things one might care about beside property values. But given how badly city governance often actually goes, we could do a lot worse than to just consistently choose policies that maximize a reasonable estimate of city property value. The more precise such property estimates can be, the more effective such a futarchy could be.

Zoning (and other policy that limits land use) is an area of city policy that seems especially well suited to a futarchy based on total property value. After all, the main reason people say that we need zoning is because using some land in some ways decreases how much people are willing to pay to use other land. For example, people might not want to live next to a bar, liquor store, or sex toy store, are so are willing to pay less to buy (or rent) next to such a place. So choosing zoning rules to maximize total property value seems especially promising.

I’ve also written before favorably on Harberger taxes (which I once called “stability rents”). In this system, owners of land (and property tied to that land) must set and may continuously adjust a declared property “value”; they are taxed per unit time as a percentage of momentary value, and must always agree to sell their property at their currently declared value. This system has great advantages in inducing property to be held by those who can gain the most value from it, including via greatly lowering the transaction costs of putting together big property packages. With this system, there’s no more need for eminent domain.

I’ve just noticed a big synergy between futarchy for zoning and Harberger taxes. The reason is that such taxes allow the creation of prices which support a much finer grain accounting of the net value of specific zoning changes. Let me explain.

First, Harberger taxes create a continuous declared value on each property all the time, not just a few infrequent sales prices. This creates a lot more useful data. Second, these declared values better approximate the value that people place on property; the higher an actual value, the higher an owner will declare his or her taxable value to be, to avoid the risk of someone taking it away. Third, these declared values are all relative to a standard terms of trade, not the varying terms of actual sales today. Thus the sum total of all declared property values can be a decent estimate of total city property value. Fourth, it is possible to generalize the Harberger tax system to create zoning-conditional property ownership and prices.

That is, relative to current zoning rules, one can define a particular alternative zoning scenario, wherein the zoning (or other property use limit) policies have changed. Such as changing the zoning of a particular area from residential to commercial on a particular date. Given such a defined scenario, one can create conditional ownership; I own this property if (and when) this zoning change is made, but not otherwise. The usual ownership then becomes conditional on no zoning changes soon.

With conditional ownership, conditional owners can make conditional offers to sell. That is, you can buy my property under this condition if you pay this declared amount of conditional cash. For example, I might offer to make a conditional sale of my property for $100,000, and you might agree to that sale, but this sale only happens if a particular zoning change is approved.

The whole Harberger tax system can be generalized to support such conditional trading and prices. In the simple system, each property has a declared value set by its owner, and anyone can pay that amount at any time to become the new owner. In the generalized system, each property has a declared value for each (combination of) approved alternative zoning scenario. By default, alternative declared values are equal to the ordinary no-zoning-change declared value, but property owners can set them differently if they want, to be either higher or lower. Anyone can make a scenario-conditional purchase of a property from its current (conditional) owner at its scenario-conditional declared value. To buy a property for sure, buy it conditional on all scenarios.

(For concreteness, assume that only one zoning change proposal is allowed per day per city region, that a decision is made on that proposal in that day, and that the proposal for each day is chosen via open public auction a month before. The auction fee can subsidize markets in bets on if this proposal will be approved and markets in tax-revenue asset conditional differences (explained below). A week before the decision day of a proposal, each right in a property is split into two conditional rights, one conditional on this change and one on not-this-change. At that point, owner declared values conditional on this change (or not) become active sale prices. Taxes are paid in conditional cash. Physical control of a property only transfers to conditional owners if and when a zoning scenario is actually approved.)

Having declared values for all properties under all scenarios gives us even more data with which to estimate total city property value, and in particular helps with estimating the difference in total city property value due to a zoning change. To a first approximation, we can just add up all the zoning-change-conditional declared values, and compare that sum to the sum from the no-change declared values. If the former sum is consistently and clearly higher than the latter sum over the proposal’s decision day, that seems a good argument for adopting this zoning proposal. (It seems safer to choose the higher value option with a chance increasing in value difference, and this all works even when other factors influence a decision.) At least if the news that this zoning proposal seems likely be approved gets spread wide and fast enough for owners to express their conditional declared values. (The bet markets on which properties will be effected helps to notify owners.)

Actually, to calculate the net property value difference that a zoning change makes, we need only sum over the properties that actually have a conditional declared value different from its no-change declared value. For small local zoning changes, this might only be a small number of properties within a short distance of the main changes. As a result, this system seems capable of giving useful advice on very small and local zoning changes, in dramatic contrast to a futarchy based on prices estimating total city property values. For example, it might even be able to say if a particular liquor store should be allowed at a particular location, or if the number of required parking spots at a particular shopping mall can be reduced. As promised, this new system offers much finer grain accounting of the net value of specific zoning changes.

Note that in this system as described, losers are not compensated by winners for zoning rule changes, even though we can roughly identify winners and losers. I’ve thought a bit about ways to add a extra process by which winners compensate losers, but haven’t been able to make that work. So the best I can think of is to have the system look at the distribution of wins and losses, and reject proposed changes where there are too many big losers relative to winners. That would force a search for variations which spread out the pain more evenly.

We are close to a workable proposal, but not quite there yet. This is because we face the problem of owners temporarily inflating their declared values conditional on a zoning change that they seek to promote. This might tip the balance to get a change approved, and then after approval such owners could cut their declared values back down to something reasonable, and only pay a small extra tax for that small decision period. Harberger taxes impose a stronger penalty for declaring overly-low values than overly-high values.

A solution to this problem is to use, instead of declared values, prices for the purely financial assets that represent claims on all future tax revenue from the Harberger tax on a particular property. That is, each property will pay a tax over time, we could divert that revenue into a particular account, and an asset holder could own the right to spend a fraction of the funds in that account. Such tax-revenue assets could be bought and sold in financial markets, and could also be made conditional on particular zoning scenarios. As such assets are easy to create and duplicate, the usual speculation pressures should make it hard to manipulate these prices much in any direction.

A plan to temporarily inflate the declared value of a property shouldn’t do much to the market price for a claim to part of all future tax revenue from that property. So instead of summing over conditional differences in declared-values to see if a zoning change is good, it is probably better to sum over conditional differences in tax revenue assets. Subsidized continuous market makers can give exact if noisy prices for all such differences, and for most property-scenario pairs this difference will be exactly zero.

So that’s the plan for using futarchy and Harberger taxes to pick zoning (and other land use limit policy) changes. Instead of just one declared value per property, we allow owners to specify declared values conditional on each approved zoning change (or not) scenario, and allow conditional purchases as well. By default, conditional values equal no-change values. We should tend more to adopt zoning proposals when, during its decision day, when the sum of its (tax-revenue-asset) conditional differences clearly and consistently exceeds zero.

Thanks to Alex Tabarrok & Keller Scholl for their feedback.

Added 11pm: One complaint people have about a Harberger tax is that owners would feel stressed to know that their property could be taken at any time. Here’s a simple fix. When someone takes your property at your declared value, you can pay 1% of their new declared value to get it back, if you do so quickly. But then you’d better raise your declared value or someone else could do the same thing the next day or week. You pay 1% for a fair warning that your value is too low. Under this system, people only lose their property when someone else actually values it more highly, even after considering the transaction costs of switching property.

Added 2Feb: I edited this post a bit. Note that with severe enough property limits, negative declared property values can make sense. For example, if a property must be maintained so as to serve as a public park, the only people willing to become owners are those who get paid when they take the property, and then get paid per unit time for remanning owners. In this way, city services can be defined and provided via this same decision mechanism.

Added 11July: On reflection, there’s not much need for the special 1% grab-back rule I proposed above. While it might be good rhetoric to allay fears, it isn’t actually needed. In principle it could reduce your loss from setting too low a price, but in practice I don’t think it will be possible to underprice that much; speculators will buy underpriced assets intending to sell them back.

Assuming that there’s a standard delay in transferring property, the moment someone grabs your declared value price, they must declare a new value. So you are either willing to grab it back at that price, and then set a new higher value, or you accept that they have a higher value for the property and can keep it. If you grab it back and set a higher value, they can of course take it at that new value; you can in effect go back and forth in an auction to see who values it more. Each time they grab from you will regret not having set a higher value; so this won’t go many rounds and will be settled quickly.

GD Star Rating
loading...
Tagged as: , , ,