Insurance Is Bad

Note: This and one or more follow-up posts contain nothing that the smart and well-informed regular readerAfter all, these readers had the wisdom and good taste to visit here. will not already know. But a surprising number of people without florid mental deficiencies and with a number of certificates indicating that they at least spent a substantial number of years in educational institutions seem to unaware of these facts or at least have them readily slip their mind in certain settings. Rather than explaining these facts over and over again, these posts will do so once and for all; in the future, one can then just refer such to these pages. The regular reader is invited to just skip these posts or just read them for the snark and jokes, as per usual practice mostly in the footnotes. Mostly.Incidentally, mostly also appears to be the author’s six-year old daughter’s new favorite word. Last night she asked her father for help closing some buttons on her, or rather the author’s borrowed, shirt. You see I am not really an expert on buttoning. So you think I am an expert on buttoning? Yeah. Mostly.

Insurance is a bad deal; the expected dollar value of getting insurance is always negative. In other words, on average everybody will always be better off not getting insurance.

This is not because insurance companies are run by Evil White Men who probably are Any Rand fans and beat their wifes. It would be true if all insurance companies were non-profits staffed, from the claims adjuster to the CEO, exclusively by angels who refused any salary beyond the minimum wage and performed their often-demanding jobs with perfect skill. Nor is it because, speaking candidly, of some neoliberal sophistry. It is not even because of economics. It is because of simple accounting:

Insurance companies do not have magic money-printing presses in their basements.If they did, why go through all the hassle of running an insurance company, rather than just the presses? Hence, their inflow of cash—the premiums—must on average over the long run at least match the outflow of cash—payouts to policy holders and operating costs, like employee salaries. As the operating costs are larger than 0, it follows that, on average, the amount the insurance company receives in premiums from each policy holder must exceed the amount it pays out to this policy holder.

Fortuitous Coincidences

Update August 13, 2016: Some details in the below account are in need of correction. Please see this post.

Update: Added the interesting and somewhat disturbing footnotes 4, 5 and 6.

The author’s grandfather FPreviously mentioned here. spent a semester in the early 1930s as a visiting professor at the University of Berlin. There he made two acquaintances that the author must consider fortuitous for he most likely owes his existence to their combination. One of them was I, a clever and pretty post-doc of Junker blood, who in due course became his grandmother. The other was a medical researcher named Gerhard Domagk.

F eventually returned to Sweden with I. In 1935, I gave birth to A, the author’s mother.Previously mentioned here. In 1937, when A was two years old, she fell deadly ill with a bacterial infection. When the best efforts of current medicine failed to cure her, F telegraphed his friend Domagk. For Domagk was said to be working on a wonder drug to combat bacterial infection, today known as Sulfa-class antibiotics. Domagk couriered a sample from Berlin to F in Stockholm and A promptly recovered.

In 1939, the Nobel Prize Committee in Physiology or Medicine awarded Domagk the Prize. While Domagk surely deserved the Prize, one cannot help but wonder if the fact that F was a member, vice-chairman, and eventually chairman of many years, of the Committee and that Domagk had saved F’s baby daughter’s life may have accelerated the process.

Why Appliances Are Getting Steadily Worse

It is a commonly heard impression that most appliances just aren’t as good as they used to be. Even high-end washers don’t wash, showers don’t clean, driers don’t dry, refrigerators don’t cool, and toilets don’t flush as well as the average model did thirty years ago. That this is not just a case of the nostalgic fallacy can readily be confirmed by anyone with access to older, but still functional appliances.

Less well-known is the cause of this decline. The technology to make effective appliances has not be lost. No rare or no longer extant raw material is needed for their construction. Nor has the Great Appliance Maker Cartel finally gotten its act together and started to foist off ever shoddier products at ever higher prices.

The abc Conjecture

This seems very interesting. Perhaps the idea of the next year, if the author can ever grasp it. Also, another example that the human brain is not designed for mathematics.

Judicial Minimalism Maximises Judges’ Power

Prof. McGinnisMcGinnis is probably the best law professor blogger not permanently ensconced at the Volokh Conspiracy. He is always either right or interesting and usually both. over at the Law and Liberty blog makes a non-original, but far too often overlooked point. Resisting the temptation to quote the whole thing, here are a few paragraphs:

At the beginning of this term of the Supreme Court, Cass Sunstein has praised judicial minimalism. Professor Sunstein argues that the justices should decide cases as narrowly as possible: Minimalists … insist on small steps and narrow, unambitious rulings. They want to resolve the specific problem at hand, but without pronouncing broadly on liberty or equality, or on the system of checks and balances.

So described, minimalism is the antithesis of a principled jurisprudence. First, minimalism does not offer a method for discerning the Constitution’s meaning. One does not need to be an originalist who believes that the meaning of the Constitution is fixed at the time it was enacted to recognize that an interpretive theory has to give account of how it is following the meaning of the Constitution. It is that meaning which should govern the case, and the relevant principles may be either broad or narrow depending on the meaning. …

Second, minimalism is incompatible with the rule of law. Deciding cases based on their peculiar facts gives little guidance to citizens as to what their rights and obligations are. Indeed, the reductio ad absurdum of minimalism is to decide the case of A v. B for A or B without giving any reasons at all: that approach surely resolves the case by making as little law as possible! More generally, insofar as a case emphasizes particular facts for the sake of a narrow ruling, its holding provides little help for those trying to figure out what the Court will do in the next case.

One issue is of course whether Sunstein is as sincere in his advice as he is undoubtedly clever. Can we expect to see forthcoming articles from Sunstein criticizing, for example, Brown v. Board of Education for indulging in general discussions of equality, rather than merely ruling that for some fact-specific reason, Linda Brown ought to have been admitted to Sumner Elementary or perhaps condemning Obergefell v. Hodges for going beyond declaring that James Obergefell was allowed to marry John Arthur?

Even setting this aside, Sunstein’s judicial minimalism reflects his broader premise (shared by such as Justice BreyerOutside the legal profession this view is also shared by the likes of Dylan Matthews and Erich Ludendorff. The principal author of the Constitution took a rather different view and is hence condemned.) that high-level government officials (like Sunstein, at times, or Breyer), be they bureaucrats or judges, are people so good and so clever that they should be permitted to decide any issue as they deem fit at the time without being troubled overly much by such constraints as laws, general principles, or consistency. For those who share this premise, Sunstein’s and Breyer’s jurisprudence must be quite attractive.

Mandatory Sex Changes?

A striking, and perhaps increasingly common, feature of Progressive political rhetoric is how Progressive ideas only ever exist in two stages:

1. As long as the idea appears to be politically unpopular, any mention of it by a non-Progressive is easily dismissed by the Great and the Good. It is just a fringe phenomenon which cannot be associated with the decent, mainstream, common-sense progressive politician! Even talking about it is just cheap reactionary rhetoric to stir up the hatreds and fears their slavering hordes are so inclined to. Any effort to forestall such ideas from becoming fact, when that is so ludicrously unlikely, is just a distraction from the real issues. No honest journalist should fall for such an obvious con game by ever mentioning the idea.

2. As soon as the idea appears to be politically viable, it instantly becomes so obviously a good and right thing that anybody who does not support it reveals himself to be a hateful bigot. Such bigots must not be heard and their hate must not be allowed to poison the lives and threaten the security of so many innocent victims.

Notably, there is never an intermediate stage at which it is conceded that the idea might be worthy of discussion between decent, reasonable individuals with differing views. The transition from red-herring to holy-truth status is instantaneous. Debate is never appropriate.

In Defense of Local Governments’ Corporate Subsidies

It is commonly observed, and commonly criticized, practice of businesses when deciding where to locate a major new facility to demand subsidies from the localities. By playing the local governments of potential sites against each other, the businesses often manage to be granted substantial special tax breaks and other favors.

This is widely seen as disgraceful. Why should big corporations be able to bully local governments into granting them special favors that others in the area do not enjoy? Does this not require additional taxes on or reduced benefits for the unfavored? There are few practical proposals on how this practice could be eliminated—how could it be without eliminating the ability of localities to set their own tax policies?—but across the political spectrum there is agreement on the perniciousness of the practice and local governments are urged from all quarters not to give in to such demands.

This reaction is understandable and indeed many of the businessmen and politicians who engage in this practice do appear to be of more unsympathetic character than average for their respective species. But this reaction is also wrong. Under current legal conditions, this sort of rent extraction is often economically efficient and just.

RUN COAL

The title of this post is the license plate the author is sorely tempted to acquire for the Tesla Model S he has been driving for the last few years.The author of course realizes that in so posting, he’ll cause the hordes of Tesla-driving readers to snap up this plate in all states, thereby frustrating his plan. For that is indeed what his car runs on: coal delivered via high-voltage wires. So the environmental benefits of Teslas are probably non-existent or at least greatly exaggerated.

Moreover, Tesla and its founder Elon Musk have with some justice been criticized for pocketing large subsidies offered by the federal and state governments for electric vehicles. That criticism, while valid, is more properly directed at the politicians for instituting these subsidies, than at Musk for pocketing them.In so far as Musk lobbies for maintenance or extension of these subsidies, he of course bears some contributory guilt. If the government offered large amounts of free cash to the author, he would take it too; as he did, when taking the $7,500 tax credit for Tesla buyers.Some concern has been raised regarding the high cost of fixing dents and scratches on the Model S. That is true because the Model S is mostly made of aluminum, which while stronger and lighter than steel, is also more expensive and harder to repair. But that is a downside that the Model S shares with virtually all cars in its price range.

These points notwithstanding, the Tesla Model S is a very, very good car:More objection can be made to the noun than the adjective. Arguably a Tesla Model S is not so much a car, as a giant iPad that can take you places. This, some discussion elsewhere notwithstanding, is high praise.

Another Sad Day

Today the two leading candidates for the presidency are a pair of friends. One is the nation’s top crony-capitalist, a wizard manipulator, and an ill-mannered buffoon.This fact, being subject to judicial notice, requires no citation. The other, a woman whose principal virtue touted by her most intelligent supportersAnother intelligent Progressive, Kevin Drum, defends this argument along these lines: Sure, the laws are great! We Progressives love the law! As long as the rest of you cooperate sufficiently, as historically you have, to allow us to get whatever we want, we’ll happily follow the law. But if you tea-bagging bigots don’t, screw the law and we’ll get whatever we want anyway. Progressives appear to believe that they will always be the beneficiaries of governmental lawlessness, as lately they have been. Perhaps they are right and their ascendancy is permanent. But if the wheel should ever turn again, it will be amusing to observe how quickly they become legalists and such arguments are memory-holed. is the demonstrated willingness not to let niceties like the laws get in the way of delivering the goods. Both are awful, even by the standards of politicians. It is enough to return one to the catatonia of melancholy. Better to think of more pleasing and rewarding abstractions.

Recommended Past Topics

While the author is temporarily preoccupied with a suddenly urgent matterQuite fascinating and perhaps subject of a future post. he recommends to the attention of readers looking for new content three older groups of posts:

• In the Racial Profiling Done Right posts, the author recommends a better way to perform racial profiling which strangely has not been taken up.
• In the Kelo posts, the author disagrees with many of his ideological fellow-travelers and defends the outcome of the Kelo decision, despised by populists across the political spectrum.
• In Drunk Driving Licenses, the author suggests a concept, perhaps unsound, but amusing to reason about.

Comments welcome.And be not surprised if suddenly a lot of older comments on these posts show up. The author has almost finished debugging the code to import the old, currently invisible, Blogger comments to the new Disqus forums without the aid of either Blogger or Disqus.

My Friend H

H was a non-Communist German Jew born in Eastern Europe in the early part of the twentieth century. As such, he had the honor that two of history’s great totalitarianisms made strong efforts to murder him and his family. Happily, they were not successful and after the war H was able to escape and become a professor of mathematical physics in the United States.

It was in that capacity that the author, then a newly enrolled student at H’s institution, first met H. H had at least two understandable reasons to take a dislike to the author. One is that the author always has been the most obnoxious of students; uncontrollably blurting out objections and questions on any subject which captured his interest and disturbing carefully constructed lesson plans. The other is that the author—a tall, blond, blue-eyed gentile and with an accent easily mistaken for German—must have born a superficial resemblance to one of the groups of people who had tried to murder him.

Administrative Notes

1. Comments on the blog were shifted from Blogger to the more capable Disqus some months ago. After an apparently brief and unintentional regression, they seem to have stuck with Disqus for the desktop site. However, some viewers of the mobile site apparently still got Blogger comments, which is a pity as those comments became essentially invisible to other readers. This appears to have been fixed now, but not before another batch of comments went invisible. As the Blogger to Disqus comment export mechanism is currently broken, transferring all the Blogger comments requires some doing and the author promises to accomplish it as soon as he finds time.

2. Speaking of comments, they are very much welcomed and preferred even over e-mails (unless they concern a non-public matter of course). The author reads all comments diligently and, at least until such time as there are enough commenters to sustain a conversation without him will at least try to respond to most of them.

3. Finally, the author is sometimes asked along these lines: Why does the author refer to himself in the third person? Who does he think he is? Bob Dole? The author—as was perhaps Mr. Dole—was at an impressionable age firmly instructed that the use of the first person pronoun is the hallmark of teenage girl (or perhaps the President giving the eulogy of a person barely known or remembered). Serious people do not use them, except perhaps sparingly in unrecorded, personal conversation with intimates. This discomfort with the first-person pronouns has become too deeply ingrained to be readily discarded. Sadly, there is too much of the teenage girl (or perhaps the Presidential) in the author. So as an expedient designed to maintain at least the façade of dignity, the author has adopted the transparent fig leaf of speaking merely of the author and never himself.

The Good News from Twentieth Century History

Being free; being rich; being secure from external enemies—these are all very good things. The great good news of twentieth century history is that these are not independent goods between which one might have to choose. Rather they flow from each other and mutually support each other in virtuous circles. So one could have reasoned from first premises: freedom leads to capitalism; capitalism leads to wealth; and wealth can be turned to military might, when the need arises. But each one of these steps is sufficiently contingent and uncertain that one might harbor reasonable doubts that conclusion always obtains but for the evidence of the great conflicts of the twentieth century which confirms that—at least at the current stage of technological and social development—it always holds.

Russian Soldiers Ate My Great-Grandfather’s Brains

As a continuation of the recent series of posts on violence, family, brains, and eating,See Genius and Insanity, A Genuine Mystery, A Partial Explanation for a Genuine Mystery, and Human Sacrifice at the University. about a hundred years ago, the author’s great-grandfather—let’s call him S—was one the leading scientists in the fields of neurology and neuropathology.To judge from the accounts of family members and friends who knew him, S’s own brain was probably abnormal. At a scientific social event, he is reported to have turned to his wife and asked her why this colleague had suddenly walked away from them with such a ferocious mien on his face. His wife responded that this was probably because S had just called him an idiot to his face. To which S gravely nodded, yes, but it is true. This was apparently was typical of S and today he would probably be diagnosed with some high-functioning form of autism spectrum disorder.

A Partial Explanation for a Genuine Mystery

A recent post posited a genuine mystery: Why would evolution design a brain with capacities as useless as, for example, performing higher mathematics? This post attempts to offer a partial answer: The human brain, far from being an efficient and elegant design, is a bit of a bodge job.

Human Sacrifice at the University

The author traces his ancestry mostly to the Swedish town of Uppsala, near Stockholm. Uppsala is famous mainly for two things: its university and human sacrifice. These two facts are not unrelated.

Never Reason from a Price Change

The title is one of the favorite and oft-repeated sayings of Prof. Scott Sumner of The Money Illusion and EconLog. Yet, it bears repeating for many financial journalists and even economists too often ignore it with predictably confused results.

A Genuine Mystery

Update October 3, 2015: See A Partial Explanation for a Genuine Mystery.

Perhaps the greatest mystery in the world is based on the following set of observations:

• The human brain is a device evolved to optimize the long-term reproductive success of the associated genes in the environment of the African Savannah.
• Yet, in at least some instances it has developed the capacity to come up with ideas like Curry-Howard Correspondence.
• However, this capacity could in no conceivable way have aided reproductive success in the African Savannah.
• Moreover, at least to judge from historical anecdote, this capacity, if anything, impedes reproductive success.

The author has never run across a fully satisfactory explanation for this set of facts. It is almost enough to make one reconsider certain propositions one would otherwise (and previously had) happily and confidently Occam-razored away.

David Kessler, Serial Groper

In 1992, the FDA under David Kessler, to great fanfare and cheer from feminist activists, banned silicone breast implants in response to national hysteria fueled by daytime talk show allegations of leakage and rupture. Even then, the FDA did not justify this ban on the basis that these fears were well-founded or even plausible—they were not—but hid behind its determin[ation] that the manufacturers had not adequately addressed public concerns about certain complications.

The Once and Future Speaker Gingrich

Over at National Review, something of intramural squabble To Replace Boehner, Why Not Newt for Speaker?, Speaker Gingrich? Not Really Constitutional, Speaker Gingrich … Unconstitutional?, Jonah, Newt, and Constitutional Presumptions, and Not McCarthy? Fine, but No Non-Members Need Apply. has broken out about the prospect of Newt Gingrich, once the speaker but now a private citizen, being chosen as the successor of John Boehner. The most remarkable part of that squabble is that it is not about the highly debatable likelihood or desirability of the prospect, but the seemingly simple question of its constitutionality.

DES and NSA

One of the most remarkable episodes in the history of cryptography began in the 1970s when researchers at IBM developed what was eventually to become DES. This algorithm can be described at a high level as consisting out of a goodly number of boxes which are connected in some complex configuration. However, which particular configuration to choose among the billions of possibilities seemed largely arbitrary; the only important part was for everybody to agree on one particular choice.

Thinking Like a Lawyer

One of the promises made to students as they enter law school is that one day during their sojourn there, they will have an epiphany and grasp what it means to think like a lawyer. It is on that day, and no earlier, that they will cease to be mere law students, but become novice lawyers.

An Unwelcome Privilege

The existence of an effective, binding, civil justice system has two implications for you. The first of these is that, should somebody legally wrong you, you can sue them. The second is that, should you legally wrong somebody, they can sue you. This is often thought of as a cost-benefit balance. The capacity to sue is great, but being sued can be unpleasant. You take the bitter with the sweet, because on balance the latter outweighs the former.

That is incorrect. For both of these implications are benefits to you and, for most people, most of the time, the capacity to be sued is a far greater benefit than the capacity to sue.

The Current U.S. Immigration System Is the Best That Can Be Hoped For

The titular proposition, not endorsed by any politician or commentator the author is aware of,The closest parallel are some remarks unsurprisingly by Milton Friedman: Now, that Mexican immigration, over the border, is a good thing. It’s a good thing for the illegal immigrants. It’s a good thing for the United States. It’s a good thing for the citizens of the country. But, it’s only good so long as its illegal. is a peculiar one to be advanced here for reasons both personal and principled.

How to Easily and Cheaply Stop and Reverse Illegal Immigration

Exchanges may be mutually beneficial and yet never occur because of the Prisoner’s Dilemma. If one party can costlessly renege on its promises after the other party has performed, the observed equilibrium will often be universal defection without any mutually beneficial cooperation. One of the greatest benefits of laws and courts is that there mere potential of suing for breach of contract is enough to move us to the cooperative equilibrium without even requiring very many such suits.

The Intelligible Argument Against Citizens United

It has been noted, both here and elsewhere, that the popular bumper sticker arguments against the Citizens United decision—Money Isn’t Speech! and Corporations Have No Rights!—are legally ludicrous and would not be made by any competent constitutional lawyer.

E = m c2?

The titular formula is to many both the epitome and sum total of modern physics. It is regarded as the peak of human genius and the blueprint of the nuclear bomb.In some of these description, superlatives and awe seem to substitute for understanding. Surely, it covers blackboards in the lecture halls and offices of all reputable physics departments.

But surprisingly it does not. Even more surprising is the reason: this equation is universally agreed to be hogwash when the variables are interpreted in the way modern physicists find most convenient.That modern physicists know that \(c=1\) is a secondary reason for it merely renders the equation excessively verbose, rather than flatly wrong.

Is There Only One Electron?

Update October 26, 2015: A very good Pop Physics/Mathematics lecture by Prof. Robbert Dijkgraf The Unreasonable Effectiveness of Quantum Physics in Modern Mathematics is youtubed here. From about minute 19 to minute 22, Dijkgraf explains and offers some history on the theory discussed in this post, albeit without offering an answer to the reason the theory is rejected here. The whole thing is highly recommended as both accessible to the interested layman and offering some amusing details to the professional.

Note: This post contains a strong hint regarding the author’s proposed answer to a puzzle he once posted.

There is an amusing, if probably ultimately flawed, theory that seeks to explain the remarkable fact that of all the \(10^{80}\) or so electrons or so in the observable universe, every single one appears to have exactly the same mass and charge. Moreover, all the positrons (i.e., the electron’s anti-matter twin) also seem to have exactly the same mass and exactly opposite charge.

Sovereign Immunity as Irrebuttable Evidentiary Presumption

The ancient doctrine of sovereign immunity to this day frequently shields the king’s men from legal liability for acts on his behalf. But this was not always how the doctrine was interpreted. Rather it was at times interpreted as an irrebuttable evidentiary presumption that the sovereign himself (i.e., the king) could not have formed a criminal intent. Under this view, the sovereign, no matter what the other evidence may say, will never be guilty of a crime.

It is in this form that the doctrine was on at least one celebrated occasion used not as a shield for a man of the king, but—in a gloriously perverse legal twistSo glorious that the author’s heart beats higher on reflecting that shares he with the authors of that twist the appellation of attorney.—as a deadly sword against a high-ranking king’s man.

The Lunacy of France

In its majestic equality, the law forbids rich and poor alike to sleep under bridges, beg in the streets and steal loaves of bread.«La majestueuse égalité des lois, qui interdit au riche comme au pauvre de coucher sous les ponts, de mendier dans les rues et de voler du pain.»

This quote of Anatole France’sThis page of the Nobel Laureate’s most famous quotes is well worth reading to the connoisseur of well-spoken lunacy. For example, it was not the Marquis de Sade, but France who said that Suffering—how divine it is, how misunderstood! We owe to it all that is good in us, all that gives value to life; we owe to it pity, we owe to it courage, we owe to it all the virtues. is often cited as profound critique of the concept of neutral law applying equally to all without regard to status. It is said to rip the mask of hypocrisy from that notion and expose it for what it is: a mere rhetorical whip wielded by the 1% against the rest of us.

Today’s Speed of Light Is 1.5180 Dollars per Pound

An article on pop physics, reportedly written by a retired Emory physics professor, is not entirely without merit or value, but it hangs itself of, and by, its subtitle question:

Light travels at around 300,000 km per second. Why not faster? Why not slower? A new theory inches us closer to an answer

To an interested layman this may seem a valid or even intriguing question. It is not.

Just Write!

Common-place, yet one thought sound, advice frequently given to aspiring authors:

Just write! Put words on paper or screen and share them with whoever may be willing to read them.

Do not allow yourself to be worried about imperfection. For that will only ensure that you never write.

Perfection, should that ever become a necessity, can wait until such time.

Such advice is more readily dispensed than followed. But the volume and imperfection of these pages in recent weeks should attest that the author at least made a valiant attempt to do so.

The Doppelgänger

Robin Hanson teaches economics at GMU. The author considers him to be something like a far more accomplished doppelgänger, for:

Taxes on Income, Red and Green

Prof. Landsburg recently posted a draft of his contribution to a FestschriftThe reader is urged to read the whole thing because, quite apart from the subject of this post, it has much news even for some who fancy themselves well-informed on the subject. For example, the author, while a reader and admirer of both McCloskey and the Greats of the Chicago School, had not known that he (as she then was) had been such a prominent and electrifying figure in it. for Prof. McCloskey:

Journalists—even bright and thoughtful journalists like Michael Kinsley—frequently justify the taxation of capital income with an appeal to the principle that everything ought to be taxed equally.

…

The notion of a general principle that everything should be taxed equally is pure blather, of exactly the sort that McCloskey warned us against at every turn. And if there were such a principle, it would still be incumbent on us to figure out exactly what the principle entails before jumping to any conclusions.

Why the Author Is a Lawyer, Not An Economist

The titular question is one sometimes asked of this author. For it was through his interest in economics, including the reading of the works of the economist depicted on the left, that he first had an inkling that law might be a suitable profession.The works of the other person depicted also admittedly had an influence. While the author many years later had the good fortune to meet and work with the person on the left, he has not been so fortunate with respect to the person on the right.

Ancient Liberties

The Great Schism which, to this day, splits political views across the English-speaking world and elsewhere, first arose in England when technological and social changes, perhaps inevitable, threatened to make the king (or, to say the same, the government) over-powerful. Those who take the side of the king and government in this centuries-long struggle were called at times and places Royalists, Cavaliers, pre-modern Tories, Progressives, Socialists, or even, bizarrely as they are in today’s North America, Liberals—all of these terms map onto each other with reasonable, if imperfect, accuracy. Those who took the other side were called at times and places Anti-Royalists, Roundheads, Whigs, Liberals, or, equally bizarrely, Conservatives.This does make it particularly galling to hear the most successful leader of the Royalist side in the U.S. history denouncing the resistance as Economic Royalists.

Genius and Insanity

One even somewhat familiar with the biographies of many of mankind’s greatest geniuses will be struck by the observation that an alarming fraction of them seem to have exhibited symptoms of mental illness, frequently quite severe. One need but think of Cantor, Frege, Nash, Landau, or Gödel.Newton’s name too probably belongs on this list.

The Perils of Memory

The author has found that the secret of having a well-stocked memory is to read and experience widely but, preferably, not to take notice of anything unimportant or, if that is unavoidable, to forget the unimportant as quickly and completely as possible.

This method is effective, but poses a substantial risk. For when and where one has read or seen a thing is surely unimportant and to be forgotten. But later, a vaguely remembered idea or concept may arise in one’s thoughts in a manner subjectively indistinguishable from discovering it oneself.

This has, on more than one occasion, led the author to embarrassment.

Ascendancy

Over the last year, in his spare moments between work and posting here, the author has been working on a game called Ascendancy of which he has been thinking off and on for the more than twenty years since he played Rich Skrenta's Olympia. It surely has no mass-market appeal, for it is no Farmville or even Dark Souls. Rather it appeals to a specialized taste for something like a grander scale Minecraft plus a bit of RobotWar minus the graphics.

But it occurs to the author that this is a specialized taste quite possibly shared by some of the readers of this blog. So he directs such gentle readers to the complete manual. The prototype code is nearly complete, but there is still much of work to be done with filling out the database; a task that could continue indefinitely. The comments and suggestions (including whether they would consider playing Ascendancy) of any reader are eagerly solicited in the comments section to this post.

The Best Part About Hitting Oneself in the Head with a Hammer

There is a fad, which the author was surprised to find even friends one otherwise respects to be engaged in, of natural childbirth. By that is understood to be meant a voluntary choice to give birth in the same manner our prehistoric ancestors did—without sophisticated medical assistance or pain relief. As one is reliably informed that human childbirth generally involves at least hours of substantial pain, and sometimes days of excruciating pain, one is rather surprised that any woman would volunteer herself for this ordeal. But whenever one inquires into what might motivate such a strange choice, one hears a variation of one or more of the following:

Continued Fractions Are Interesting

Continued fractions can be readily understood using only elementary mathematics, but they have many applications in solving problems in higher mathematics, such as Pell's equation. Yet, even many with more advanced mathematical training are only vaguely familiar with them.

Ultrafinitism Is Interesting

Lately one has been trawling YouTube for lectures on subjects in higher mathematics, physics, computer science, and economics. These lectures, like the ones from MIT OpenCourseWare (generally excellent, but limited), can be run in the corner of one's screen to refresh one's recollection, or perhaps even learn new ideas not covered in one's student days, while performing other tasks which do not require total concentration. In this course, one ran across the productions of one Norman J. Wildberger.

Administrative Notes

A few changes have been made to this blog that may be of interest:

1. Readers interested in the content of the blog, but understandably unwilling to check the page frequently to discover when there has been one of the admittedly sporadic additions, can now subscribe via e-mail on the form in the right column. In addition, readers have always been able to subscribe to the full RSS feed.Caveat to readers using either e-mail subscription or RSS feed: The blog often contains typographical features, like equations or footnotes, which do not translate well into those formats and may appear as gobbledygook. Also, the author frequently edits posts after publication: to correct orthographical errors or solecisms, or to add explanatory footnotes or illustrations (but never to retract statements; in retraction is called-for, it will be in a new post). In those cases, it is recommended that the reader visit the actual blog where things display correctly and completely. E-mail and RSS subscriptions are still perfectly useful for other posts or as notifications that something new has been added.
2. There is now a blogroll, also in the right column. Listing of a blog there indicates no more or less than that the author regularly reads it and recommends it to his readers. It does not imply that the author endorses all, or even most, of what is posted there.
3. As part of these changes to the blog layout, the blog appears to have switched back to Blogger, rather than Disqus, comments. That was not the author's intention and comments appear to have returned to Disqus now. The author apologises to any commenters whose words were misdirected to Blogger comments and are now invisible. The author is diligently working on a solution to transfer all of these Blogger comments to Disqus.

Political Correctness and Hyper-Straussianism

There is a Straussian school of textual interpretation named after its founder, Leo Strauss, and which forms part of a larger framework of Straussianism.

At the core of Straussian interpretation is the insight, often forgotten by modern readers, that past thinkers, like Socrates, often lived under conditions which would have rendered some conclusions dangerous to state. The ruler or the religious establishment may take offense to some conclusions and punish the thinker should he openly state them, as indeed was the cause of Socrates' death.

Of Marriage, Taxes, and Punching

Imagine a genie were to appear before you and offer a deal along the following lines:

If you accept this one-time offer, you will never have to pay income taxes at a marginal rate above that of the median tax-payer. Even if you earned millions and lived in a high-tax jurisdiction, like New York city or California, your total marginal income tax rate will remain at about the 10% the median tax-payer pays, rather than the 50% or 60% you might have to pay under current law in these jurisdictions.

But this deal also has a down-side: You will never be allowed to marry. Sure, you will still be free to cohabit with any person of your choice, procreate, raise off-spring together, and make any contractual arrangements that seem suitable to you and your partner. You, your friends, and others (such as your church) would even be free to call such an arrangement marriage. But the government never will.

The Sun Orbits Around the Earth

One commonSee, for example, here for the usually much more astute Ilya Somin embracing this fallacy. trope of reporting on the scientific illiteracy of Americans goes something like this:

When surveys ask American adults to pick between the statements (A) the earth orbits around the sun and (B) the sun orbits around the earth, a large minority of about 25% pick statement B, rather than the correct statement A. This proves how shockingly ignorant many Americans are of scientific issues.

That conclusion may very well be true, but the argument proves no such thing; rather, it is merely sneering of the semi-educated at the honestly ignorant.

The Idea of My Year: Curry-Howard Correspondence

Edited on September 20, 2015 to add footnote 4.

Curry-Howard Correspondence was first published in 1969, before the author was born, but the author only learned of it in the present year. That alone is enough to induce a desire to go back to everybody one has ever encountered, starting with one's mother and father, grab and shake them, and cry You knew I lived, breathed, thought! Yet, you allowed me to remain in ignorance that such beauty and cleverness existed. How could you have been so cruel and thoughtless? Regardless, it is the idea of the author's year. To rescue the reader from the purgatory that ignorance of Curry-Howard Correspondence is, let one make an inexpert attempt to explain it here.

Whose Side Are You On, Anyway?

Recent comments on abortion have provoked friends, acquaintances, and strangers alike to make the above inquiry and—in some of the less friendly instances—to imply that one is a renegade from a cause previously believed to have been shared. In the past, comments on climate change, immigration, homosexuality, crime, religion, and others, have caused similar responses.

One could, perhaps, just state one's ultimate conclusions—of which the author is in ample supply—add some venomous barbs for all who do not share them, and consider the job well done. Indeed, most commentary seems to fall squarely within that category.¹

The Unconscious Violinist and More Realistic Hypotheticals

One argument—once very common, but perhaps less so today—in favor of an wide-ranging right to abortion was put forth by Prof. Judith Jarvis Thomson in A Defense of Abortion, said to be the most widely reprinted paper in the history of philosophy:

In Defense of the Sunk-Cost Heuristic

One of the perennial bugaboos of introduction to economics courses¹ is the sunk-cost fallacy. The fallacy goes generally like this:

Abortion Should Be Between the Woman and...

While on a subject as conducive to reasoned and congenial debate as abortion, one might contemplate a position very commonly expressed by ostensibly moderate Pro-Choice politicians and commentators:

Now, I am not saying that abortion is a good thing. I just think that we should keep the heavy hand of the state out of it. The decision to have an abortion really should be between the woman, her partner, her doctor, and her priest.

This is apparently a position often taken to great success by politicians with mixed constituencies because it pleases the dimmer sorts of both libertarians (who applaud the denial of state authority) and communitarians (who appreciate the involvement of local groups, instead of mere atomistic individuals).

Not Everything Human and Alive Is a Human Life

One argument sometimes heard from intelligent, widely-read, pro-life advocates runs as follows:

A fertilized ovum is, by generally agreed definition, a living cell. Moreover, it contains the full set of genes which identify it as a human cell. Being human and living, it is definitionally a human life. Deliberately and without valid excuse causing the end of a human life is murder. Hence abortion is murder.

Drawing Borders in Sand

If one asks persons sympathetic to the causes of Arabs and Arab governments—a group including the vast majority of Western academics specializing in the subject—about the reason for the generally high levels of violence and poverty in Arab lands, one frequently hears a variation on the following theme:

Why Sub Specie Æternitatis?

In order to indulge my vanitysatisfy the insatiable curiosity of the clamoring masses, let me briefly explain why I chose this particular pseudonym. (The reason this blog is weakly pseudonymous was given below.) The author would like to say that it was his profound engagement with the thought of Aquinas, Spinoza, and Wittgenstein which inspired him to pick this particular nom de cyber. Sadly that would be a lie.

In Search of Fiction with a Particular Twist

This post requests the gentle and well-read readers' suggestions for fictions with a particular twist.

The fiction is most likely a short story or novel. It could be a movie, but due to the nature of the narrative that would be very difficult to do well. It is quite possibly genre fiction, most likely science fiction or mystery. As it relies on the trope of the unreliable narrator, it is unlikely to have been produced before the twentieth century.

Economic Illiteracy Grows at Twice the Rate of Inflation

A common trope in economics reporting is to claim that this or that figure had risen at some multiple, usually double, of the rate of inflation. For example, the New York Times reported:

The Paradox of the Lying Judge, Part 2

Another post discussed what is commonly called the Paradox of the Unexpected Hanging. The conclusion was not that the judge might have been lying, even though he turned out not to be, and that the lawyer's argument is somehow flawed for not taking that possibility into account. The conclusion was that the judge most definitely was lying (or, used synonymously here, mistaken).

The Paradox of the Lying Judge

In the discussions of the pirate puzzle an interesting point was raised when Robert Murphy of Texas Tech mused¹ that there may be an analogy to what is conventionally called the Paradox of the Unexpected Hanging.

How an Alien Can Predict Humans

Imagine you were an alien come to visit the earth to find out what makes humans tick. The purpose of your mission is determine what the humans will do in the future and, in particular, if in time they are likely to become a threat to your civilization. If so, your civilization will put an end to the human one before it becomes a threat.

Gödel's Unsurprising Theorem

Consider a mathematical system \(M\) consisting of two parts:

Voluntary and Involuntary Unemployment

A recent post defined and used the term involuntary unemployment in the standard economic way. A person is involuntarily unemployed if and only if:

1. The person is unemployed; and
2. there exists a wage \(w\) for which that person would be willing to work; and
3. there exists somebody else that would be willing to pay \(w\) for that person's services.

How Ferocious Pirates Divide Gold

Post updated on September 10, 2015.

Steve Landsburg, a mathematician and professor of economics, blogs at The Big Questions. The blog's position near the top of my daily read of hundreds of RSS feeds bespeaks the excellence of its content. Anybody who enjoys this blog would doubtlessly enjoy The Big Questions at least as much.

Today, Prof. Landsburg posted a mathematical puzzle said to have been given in Google job interviews:

The Bullet in the Head

A philosopher is a friend (or lover) of the Truth. One might think that this would be a curious distinction to claim as are we not all friends (or lovers) of the Truth and, hence, every man and every woman a philosopher?

A Philosophical Dialogue on Obligation (with Some Action)

Two philosophers, A and B, taking a walk along a lakeside and debating their subject, when they notice a child apparently drowning in the lake. B is physically frail and cannot swim, but A is a strong swimmer and so immediately sets out to jump into the lake.

How to Stir a Cup of Tea

You have just made yourself a cup of tea. On top of this cup you have poured some milk. Now what?

A Coda on the Periods Function

A recent post discussed the problem of a periods functions which, when given a potentially infinite list, will reliably determine whether that infinite list is periodic and, if so, with which parameters. It was claimed that a general strong periods function, which always works, is impossible because it would imply a solution to the unsolvable halting problem. Instead, a weaker, but still useful, periods function was offered that produces useful output, but does not terminate on infinite lists.

How to Eliminate the Capital Gain Deferral Distortion

And now for the thrilling conclusion of the blockbuster series of posts on the capital gain tax deferral distortion! We have seen how it arises, how some common-sense fixes cannot work, how bond taxation addresses it imperfectly, and how it can be exploited to shield even current investment returns from taxation.

More Fun With Capital Gains Tax Deferral

Recent posts have described how capital gains tax deferral allows investors to reduce their effective tax rate asymptotically to zero, how this distorts investment decisions, how market-to-market cannot fix the problem, and how bond taxation partially deals with the problem. Before the eagerly anticipated revelation how the tax code could fix this distortion to come in a future post, let me describe another method by which this deviation can be further exploited.

Testing Periodicity in Haskell

If you are dealing with infinite, but potentially periodic, series, you may sometimes have wished there was a function, let's call it periods, that could be given such a series and tell you whether it is periodic and, if so, the length and starting point of the period.

Sadly, such a function is impossible. There is no way for the function to determine whether any apparent period is genuine or there is a break at the \(n\)th element without looking at every single element. And checking every single element of an infinite series obviously cannot be done in finite time.

Tribonacci Coda in Mathematica

One question one might have after going through the Haskell Tribonacci problem is why it should be necessary to go through all that complication with recursive matrix multiplication in order to calculate such a simple function. Surely, one might say, there must be a mathematical formula into which you just plug in \(n\) and out pops the corresponding Tribonacci number.

How Bond Taxation Addresses the Deferral Distortion

A previous post discussed the economic distortion caused by deferral of capital gains tax, another, why market-to-market cannot fix this distortion. This post shows how the tax code tries, but does not entirely succeed, in addressing this issue with regard to bonds.

Tribonacci Function: Exercise in Elementary Haskell Optimization No. 2

This is the second entry in an intermittent series of posts on how to optimize some basic mathematical functions in Haskell. The previous entry is here.

Consider the following problem: A person is ascending a staircase with \(n\) steps. The ascendant is sufficiently tall and the steps sufficiently shallow that with each gait, the ascendant can take one, two, or three steps. How many different ways are there for the ascendant to reach the top?

Mandatory Mark-to-Market Cannot Fix Capital Gains Tax Deferral Distortion

A previous post discussed the issue of the deferral of capital gains tax and why, if there is going to be a capital gains tax, this deferral distorts economic decision-making. The issue of this post is whether mandatory mark-to-market taxation can fix the problem.

How to Cut Taxes When Congress Won't

Imagine a 2017 with a newly sworn-in President Paul (or Cruz), but a Congress no more and perhaps less conservative than the current one.

The President announces as one of his main legislative priorities a comprehensive reform of the tax system, including reducing the top marginal individual federal income tax rate from the current 44% or so to 25%. However, after extensive debates accompanied by great acrimony and perhaps a filibuster or two, Congress refuses to enact the President's tax reform.

Economic Distortion of Capital Gains Tax Deferral

One under-appreciated feature of capital gains taxation are the substantial implicit benefits of deferral—capital gains are only taxed once they are realized (i.e., generally when the investment is cashed out), not when in any economic sense they are earned. Effectively, deferral renders any sufficiently long-term capital gain tax-free, regardless of what the statutory rate is.

To understand this counter-intuitive—after all, aren't long-term gain still taxed before you can ever get the cash?— conclusion, consider the following hypothetical:

Comments Shifted from Blogger to Disqus

I am experimenting with switching from the Google/Blogger comment system to the Disqus system, which in my experience as a commenter is quite superior.

One consequence is that the old comments have disappeared—worry not, your words have not joined Lois Lerner's e-mails. They just don't show up as Disqus comments because the software to export Blogger comments to Disqus is currently broken. As soon as that problem has been alleviated they will show up in the Disqus system.

Comments on comments very welcome.

Planned Parenthood Baby Part Sale Kerfuffle

Planned Parenthood, the nation's largest abortion provider, sells the body parts of late-term babies they aborted for medical research. A videos of a sting operation showing senior Planned Parenthood executives discussing such sales, including abortionists buying Lamborghinis with the proceeds, have been posted to YouTube. Predictably, Pro-Lifers are outraged and the mainstream media have either been ignoring the story or focused their outrage on the violation of Planned Parenthood's privacy.

Prime Number Sieve: A Study in Elementary Haskell Optimization

Recently I ran across the following implementation of the Sieve of Eratosthenes (which calculates all the prime numbers) in post on the Code & Co. blog:

What Matters and What Does Not about the Laffer Curve

The basic idea is that, if you plot the revenue generated by any given tax against its rate, you'll virtually always observe: (1) no revenue at a 0% rate; (2) no revenue at a 100% rate, and (3) between these rates the function is concave.

Quiz: Why Are There No Higher Voltage Lines?

Note November 9, 2015: Commenters jonshea figured out my proposed reason.

Note: A hint to the proposed answer for this puzzle is offered by another, more recent post here.

Large amounts of electrical power are generally transmitted via high-voltage lines. The reason for this is pretty basic:

Eliminating the Mortgage Interest Deduction Would Not Make the Tax Code Fairer

One frequent point made by free-market types, such as myself, is that the tax code's many preferences and deductions make the tax code distortionary and result in unnecessarily high marginal rates. The prime example cited is always the mortgage interest deduction which is said to favor the well-to-do and cause house prices to rise too high. While the general principle is sound, abolishing the mortgage interest deduction is not necessarily a step in the right direction.¹

Australia Does Retirees No Favor

Matthew C. Klein over at Bloomberg View argues that the most recent move does:

The biggest pension fund in Australia is planning to directly manage 30 percent of its assets by 2018, rather than outsource the task to expensive external managers who rarely justify their high fees with superior returns. This should help the fund cut costs and boost retirement benefits.

While the basic premise—actively managed funds usually don't justify their high fees—is correct, this proposed reform is likely to make things worse rather than better, at least for the putative beneficiaries, for two reasons:

Tim Worstall Gets Econ of Insurance Wrong

Tim Worstall is a British economic commentator with a free-market bent who writes for Forbes and the Adam Smith Institute. His usual beat is the economic fallacies of some other, less insightful British econ commentators and his denunciations to them are often highly amusing, if a little salty.

In a recent post on the economics of insurance, I think he screwed the pooch. He tries to explain why writing insurance which are unprofitable on insurance basis might still be a good business: