I may have missed a few things but here is a possible back story for the United Airlines scenario:
In defence of the customer:
In my law and economics courses, I always taught the students to ask two questions:
In this case, what is the risk? The unlikely event that someone will be involuntarily bumped? Or that four flight crew members will be needed (unexpectedly??) in Louisville first thing the next morning? If the latter, it looks as if the airlines are asking people to sacrifice something to cover up poor planning on the part of the airlines, which doesn't look good. Or at best the airline is asking customers to buy insurance against possible poor planning by the airline. And then enforcing the insurance contract.
Who is the least-cost bearer of the risk? The airlines essentially sell insurance against being involuntarily bumped; they do this via their ticket pricing. If you pay more for a ticket, you will be less likely to be involuntarily bumped. If the doctor knew this, he essentially declined the insurance.
Again, it is most likely possible that United Airlines was the least-cost bearer of the risk and will (or should) make sure people are involuntarily bumped in the departure lounge and not once they board the plane. If United Airlines didn't anticipate this situation far enough in advance to keep people from actually boarding the aircraft, they could possibly charter a private jet to ferry the four crew members to their next location. I expect this option will look much more attractive to airlines in the future.
How many of us know about the greater possibility of being involuntarily bumped when we book a cheap ticket? Not many before the weekend, I expect. More should know it now. But instead because of the news coverage, we blame United Airlines and the Chicago airport security staff for the incident.
Most of my friends seem to disagree with my take on this situation, arguing that the customer should not have been removed violently. But the customer was actively resisting, causing a large fuss. Maybe he owes all the other passengers compensation for having delayed the flight by two hours and for having disturbed them so much.
I may have missed a few things, so I'm perfectly willing to adjust my take on the situation.
The other day Otis sent around this piece bemoaning the fact that undergraduates are unable to engage in critical thinking and that they don't learn a thing about critical thinking at college or university. Some excerpts:
... [A]lthough faculty in the humanities and social sciences claim to be teaching critical thinking, often they’re not. Instead, they’re teaching students to “deconstruct”—to privilege their own subjective emotions or experiences over empirical evidence in the false belief that objective truth is relative, or at least unknowable. That view runs contrary to the purposes of a “liberal arts” education, which undertakes the search for truth as the academy’s highest aim. ...
Unfortunately, such internalization of meaning does not culminate in open-mindedness and willingness to examine the facts and logic of differing views. Rather, it leads to the narrow-minded, self-centered assumption that there is a “right” way to feel, which automatically delegitimizes the responses of any and all who may feel differently.
All of this has a profound impact on students and explains a great deal of what is happening on colleges campuses today, ... Today’s students are increasingly incapable of processing conflicting viewpoints intellectually; they can only respond to them emotionally.
More to the point, that explains why employers keep complaining that college graduates can’t think. They’re not being taught to think. They’re being taught, in too many of their courses, to “oppose existing systems”—without regard for any objective appraisal of those systems’ efficacy—and to demonstrate their opposition by emoting.
For some reason, although I agree with the general thrust of the article, it provoked me to think about my own general lack of critical thinking ability. I wrote the following to Otis and friends (edited for this blog post).
Two years ago, I saw "Midsummer Night's Dream" in Stratford. I gave it a 3/5 star rating. The acting was superb but the cross-gender casting was annoyingly gimmicky. It made no sense.
Fast forward two years to the upcoming performances of "The Merchant of Venice" at The Arts Project in London, produced by Crow Bait Productions.
In this adaptation by Jason Rip, there isn't really cross-gender casting, but the roles have been redefined and include what can best be described as "gender-fluid" characters, loan sharks, drug dealers, rappers, major media, and Jewish crime bosses. The language is Shakespeare's, but the setting is modern.
And it all hangs together beautifully. It has a modern-day internal consistency that was lacking in the Stratford production of "Midsummer Night's Dream". And the acting is superb.
If you have ever seen or read "The Merchant of Venice", you will be very impressed with this production. Heck, even if you haven't read or seen it, you'll be impressed. The continuity, the modernization, the setting (for a black-box theatre), and the acting will all impress you.
Of special note is the performance by Franklin Davis Jr as Shylock. I have never seen anyone portray Shylock as well and as convincingly as he does. The others are all excellent, but he is stunningly amazing. I am moved to tears by his speech "Am I not a Jew..." every time he delivers it.
Franklin Davis Jr as Shylock:
I'm happy to be along for the ride, with two minor roles as Old Gobbo (a blind street person who sells soap to earn a bit of extra cash) and Tubal (kingpin of the Jewish underworld?), along with some stagehand work thrown in for good measure.
Me as Tubal during a dress rehearsal:
The conceptualization by Jason Rip is just plain brilliant. His work, along with that of the producer/props-person/jane-of-all-trades Sue Parke, co-director Kim Kaitell, and stage manager Emma Wise, has brought to this stage a production that is far superior to the glitzier but far less brilliant productions I have seen in Stratford.
If the folks at London's Grand Theatre or Niagara's Shaw Festival or Stratford's Festival had any sense, they would put Rip and Davis under contract to move this production to their stages. It's that good.
One of the very rewarding aspects of teaching is seeing one's students success. Even more rewarding is their thanks when they assert that one played a role in their success.
Such is the case with Harold Winter, a student in a course on law and economics that Stan Liebowitz and I team taught at UWO back in about 1980. Harold went on to earn a PhD at Rochester and has taught economics at Ohio University for 30 years. Believe it or not, despite the passage of time, I remember him quite well.
During his tenure there, Harold has written several books on economic policy and on law and economics. I reviewed his first book on the blog over a decade ago. His latest is even better written and is fascinating. I highly recommend it.
The personal inscription in copy that Harold sent me was very nice:
And these thoughts were repeated in the Preface:
A good course in The Economic Analysis of Law should emphasize applications of price theory and economic fundamentals. Harold Winter's work does these things superbly.
The news media have been full of stories and hand-wringing about the high prices of homes in Vancouvre and Trono. From Lawrence Solomon [via Dr J]:
The Greater Toronto Area is heading into a catastrophic housing bubble, some experts warn, pointing to a raft of scary statistics, such as the sale of detached homes averaging $1.2 million in February, a 32.5-per-cent increase over a year earlier. In a panicked response to this possible crisis — the 2007 U.S. housing bubble is still fresh in people’s minds and some still shudder over Toronto’s 1989 housing bubble — politicians, planners and pundits are recommending everything from tighter lending rules, to a tax on purchases by foreigners, to subsidies for more affordable housing.
But one reason people are paying outrageous prices for houses in Trono is that apartments are taxed three times the rate of houses:
Unbeknownst to most tenants, their property-tax rate is three times that of homeowners since apartments are taxed at triple the rate of private homes. City councillors have good reason to turn the screws on tenants. For one thing, tenants don’t pay property taxes directly — these are buried in their rent, leading tenants to blame their landlords, rather than their councillors, for high rents. For another, homeowners are likelier to vote than tenants, largely because many tenants are immigrants who lack citizenship.
If the city taxed homeowners and tenants equally — or even better, if the city moderated the property tax through user fees that had homeowners and tenants paying a fairer share of the costs they impose on the city — home ownership would look much less the bargain to the tenant feeling pressure to buy a home. If city property taxes on businesses also reflected actual costs — rather than being raised to confiscatory levels to cross-subsidize the homeowner — home ownership would look like no bargain at all.
Renters are often under the illusion that it's the landlords who pay the taxes, not the tenants. But of course the rent must cover all the costs involved. Renters pay these high taxes, albeit via a pass-through operated by landlords. The high rents, caused in part by the discriminatory high taxes, induce more people to look into buying homes, thus driving up the prices of homes.
Quite honestly, I have no idea how young people with families live in big cities. I look for more companies to move to smaller cities to attract workers with shorter commutes and lower housing costs.
I led off one of my early publications with this paraphrase of a poem written by Dennis Robertson
When I had scarcely learned to toddle,
my parents handed me a model
with lots of little leads and lags
and pretty [hyperbolic] bags.
Robertson wrote the piece in frustration because he was skeptical about the mathematical and econometric modeling that was occurring in the 1940s and 1950s, but his original poem said "... and pretty parabolic bags." I changed it to "hyperbolic" to suit the content of that paper.
"A Further Analysis of Provincial Trucking Regulation," The Bell Journal of Economics and Management Science 4 (Fall 1973): 655-664.
Some years later I published a piece on the Social Costs of Adoption Agencies. The lead poem for that was something I read in one of my children's song books, "Sally Go Round the Sun":
This is the day they give babies away,
with a half a pound of tea.
You open the lid, and out pops the kid
with a ten-year guarantee.
One of the administrative assistants back then told me she remembered that rhyme from her childhood in England.
The other day, JR, my favourite drug dealer, attached this poem to one of his messages about economics and health care. I really like it!
“Econometricians are ever so pious,
are they doing real science or confirming their bias?”
He says the poem is from this econ rap battle on YouTube. It's a nice jab at the strength of our prior beliefs and how they influence our attempts at doing science.
All the snow melted yesterday afternoon, but we had more snow overnight, enough to do another snow stomp art piece (albeit barely enough).
The bitter wind and cold, coupled with the snow, makes people think of escaping to warmer climates:
Three interesting things about doing these pieces of snow art:
My previous snow stomp art:
Planning an Escape (this post)
I am currently appearing in the play "Caught in the Net", and so it seemed appropriate when I saw the snowfall this morning to write that title in the snow:
The play is a really fast-paced farce about a man who has two wives and families, one in Wimbledon and the other in Streatham. But the deception is about to fall apart when his children meet on the internet. Hence the title, "Caught in the Net."
I have a fabulous role, type-cast as a semi-senile lecherous old man.
The remaining performances are:
Venue: The Princess Theatre (a beautifully converted church), Elgin Theatre Guild, St. Thomas, Ontario, about a half hour south of London, Ontario.
My previous snow stomp art:
Caught in the Net (this post)
Just don't try to force all of the rest of us to eat it that way.
The Philistine Liberation Organization, of which I appear to be the de facto chair, celebrates differences in tastes and preferences. From our original mandate:
The Philistine Manifesto
I have been subjected to the biases and special pleadings of the artsy culture vultures long enough. They sneer at anything which isn't in their own mold (mould?) of avant-gardishness. They perpetuate stupid jokes by laughing at people who quite seriously say, "I may not know much about..______... but I know what I like."
|It is time for the rest of us to revolt against this claptrap of self-indulgent behaviour which passes itself off as "the actualization of one's self potential," and which somehow has, unfortunately, [in Canuckland, at least] bedeviled enough politicians that fully 65.7% of our tax dollars go to supporting these alleged artistes through direct grants and purchases of junk [Voice of Fire - - need I say more?] that any sensible person would pay someone else to haul off to the municipal landfill site. It is time for a new organization to be formed to aid this revolution. To that end, I hereby announce the formation of
The Philistine Liberation Organization welcomes as new members those who support this cause. The basic tenets of the PLO are divided into two general categories: things we like and things we don't like. An overall score of 80% qualifies you for membership. ....
|The purpose of our organization, it must be made clear, is to promote tolerance and open-mindedness -- to lampoon arrogance and self-indulgent pomposity. We don't really care if you like Shostakovich, escargot, and Birkenstocks.||We also don't really care if you like Neil Diamond, pizza, and Kodiak Grebs. We do, however, become disturbed if you try to tell us what we should like; and we have apoplexy if you try to get us to pay for what you think we should like.|
Want to join the P.L.O.? ok, you're probably already a member then. Want to add to the tenets? Mail your suggestions to me, and I'll keep a list. My e-mail address is
I've been wearing bright, patterned sox almost exclusively for several years. I guess my doing so means something:
Despite our conforming attitudes, a study published in the Journal of Consumer Research investigated the theory that people who are nonconformists can potentially be viewed as being more high status and more competent than those who conform to social norms.
So what does this say about your choice of wearing bright neon, rainbow-striped, or leopard-print socks? Well, it found people who have shown to deliberately choose to wear whacky socks, are seen as having increased status and competency in the eyes of others. In other words, people have the potential to see you as more brilliant, creative and successful.
Some key words in that quote: "potentially" and "potential". Some of us don't live up to our potential. But maybe wearing bright sox signals some potential; or maybe doing so is just a false signal used by some of us to signal something we're lacking and the bright sox are just wistful signs from wannabes.
Previous posts with photos of my socks:
I have lots more bright sox now than I did two years ago. In fact I actually wore out some of the sox in those photos, I wore them so much.
Yesterday morning I woke early and looked out the window. Yea!! Lots of new snow on the lawn in front of our building. So I dressed quickly and went outside to do some snow stomp art. I knew the temperatures would rise this coming weekend, and that made me think of surfing. The street lamps were still on, and the sun hadn't risen yet.
As I said, I expected the image wouldn't last very long because the forecast says we will have temperatures up over 10C (50F)* this weekend. But I hadn't counted on the wind blowing so much of the snow away.
It did, though, so I went out about 10 am to fix it up a bit.
The wind continued, though. I figured the whole thing would be gone by evening, but here's a photo I took of the work at about 11pm last night:
The writing was gone, but the surfer dude in the pipeline survived in great shape!
And he is still there this morning!
But he is fading fast.
True story: I taught at the University of Hawaii in the autumn of 1986. I regularly went to the beach between classes and learned to surf. Students in my afternoon law & economics course would laugh and point at the sand on my feet "We know where you were!"
I never was very good at surfing, but it was fun and it was great upper body exercise. We also spent a LOT of time at Bellows beach using body boards and catching waves. So much fun!
*Reminder: C = Canadian, F = foreign when talking about temperatures.
My previous snow stomp art:
Surf's Up (this post)
The basic premise of economics (and many other social sciences) is that "People Respond to Incentives". Here is another example (via Jack):
[W]hile Manitoba offers legal aid to refugees, the provincial government confirmed in an email that Saskatchewan is one of four provinces that does not. ...
"If someone is making a refugee claim in Saskatchewan they have to spend their own money from their own private funds to hire a lawyer and they simply do not have any money," [Winnipeg attorney] Khan said.
The lack of aid is leading many refugees to chose Manitoba over Saskatchewan, he said.
Prices change. Sometimes the price change is caused by a shift in supply, sometimes it is caused by a shift in demand, and sometimes both supply and demand change, leading to uncertain ambiguous results.
We try to drill these basics of supply and demand over and over in our introductory economics classes. But these lessons seem to escape many students once the exams are over. And the lessons seem to escape too many economists who too often reason from a price change rather than looking for what underlying factor(s) may have caused the price change.
Scott Sumner at EconLog has an excellent brief post about this issue.
The questions . . .
Would it be a good thing if interest rates rose?
Would it be a good thing if copper prices rose?
Would it be a good thing if the dollar appreciated?
. . . are all basically meaningless. In all three cases, the prices never change for no reason at all. In each case the real question is whether the thing that causes the price to change makes us better off or worse off.
In all three cases, the price/interest rate/exchange rate might rise due to strong economic growth in America. That would probably be a good thing. The exchange rate and the interest rate might rise due to tight money. That would be a bad thing if tight money were not appropriate at that time. Copper prices might rise because of civil wars in copper producing nations. That would be a bad thing.
This isn't just a minor problem; the economics profession is waste deep in reasoning from a price change...
Sumner adds some examples about interest rates.
But the problem is a serious one: when a price changes, don't ask if it is good or bad because the correct economics answer is, "It all depends". Ask why the price changed. And once that answer is clear(er), you'll have a better idea of whether it is good or bad ... and for whom.
Here is more evidence that the best use of investment funds for the long term is low-cost (low management fees) index funds and passive management. The big endowment funds that used active management were out-performed over the past five and ten years by smaller endowment funds that relied more heavily on passive management, index funds, and low MERs [Management Expense Ratios]. The real take-away nugget appears well into the article from the NYTimes:
Vanguard said a simple mix of index funds with 70 percent in equities and 30 percent in fixed-income assets delivered an annualized return of 7.1 percent over the past five years, and 6.1 percent over the past 10. For a mix of 60 percent stocks and 40 percent bonds, the returns were 6.7 percent for five years and 6.1 percent for 10.
By comparison, the annualized returns for the billion-plus endowments were 6.1 percent for five years and 5.7 percent for 10.
Hedge funds, however, have successfully marketed themselves as offering higher risk-adjusted rates of return, in part because they supposedly minimize losses in down years. But according to Vanguard’s calculations, its simple, low-cost model portfolios have provided higher returns even after adjusting for risk in eight of the past 11 years.
I would love to be able to buy into such a set of mutual funds. But I can't without massive exposure to tax liabilities from the freakin' IRS. Grrr.
I know there are some people who beat the market consistently. They (and their investors) believe they are better/smarter than the hoi poloi of the marketplace. It's also possible they are just luckier: if 10,000 people flip a coin a hundred times each, a few just by chance will get strings of 20-30 heads in a row and 60-70 heads overall.
Recently I was in the local liquor monopoly (aka the Liquor Control Board of Ontario [LCBO]) and asked if there was any Ledaig available. They went on their computers and LO! there are about 40 bottles available in Ontario. I had them order me a case of six bottles, and I picked them up yesterday.
For those of you in Ontario, you can also order it online and have it delivered to a local LCBO outlet. Here is the link.
This is amazing scotch. It's about half the price of Lagavulin, and better (for my tastes, noticeably better). And the 46.3% alcohol provides a very nice bite that I really like.
Order a bottle or two now if you live in Ontario (elsewhere, like Houston or Miami or Alberta, you can just find it on the shelves of many liquor stores). I'll give you a fair chance -- I'll wait a week or so before ordering more.
There is an infinite number of exact replicas of me typing on a Macbook right now.
There is also an infinite number of exact replicas of me typing on window-based machines right now.
There is, generally, an infinite number of exact replicas of me doing an infinite number of different things right now.
And that's true for every being in the universe.
All prompted by this:
After using my snowshoes to lay down a texture on my "canvas" this morning, I then went out to add the highlighting features that show the true nature of what I was trying to accomplish with this piece of art.
No line in the entire work was intended to be straight. Each one has a bit of a "warp" to it.
Here is the final version (well a portion of it. It fills the lawn).
Here are links to my previous snow stomp art creations:
With the fresh snow overnight, I was really excited about getting outside to do some more snow stomp art. I had a large plan in mind, and I eagrely dug out my snowshoes for this one.
Unfortunately, the wind had blown away much of the snow, and the intricacies of the pattern don't show much, if at all.
If you look carefully, you can see that the entire piece is made up of diagonal "lines" which are never quite straight, warping one direction and then another.
Oh well. I'll have to wait for a better snowfall I guess.
Diagonally Warped in a Parallel Universe (this post)
We all know the media are biased. We see their biases most clearly whenever they say things or slant things or use loaded terms that are counter to our own personal views. And our perceptions of media bias are influenced by our personal views.
There has been a graphic floating around Facebook that, to my mind at least, doesn't recognize the left-ish elitist interventionist views of many of the major media. That graphic, in itself, reflects major biases.
Here, courtesy of Adrian Sjoberg, is that same graphic, redone to reflect what I think are better characterisations of the slants of most of the major media; he has also included a few from Canada (note: I would put the CBC even farther to the left than he did).
This graphic shows what I think many of my economist and libertarian-type friends believe: most of the major media are biased to the left, toward thinking that bigger gubmnt is better and that market failures are more serious than gubmnt failures.
Digression: some thirty years ago when I was teaching economics courses for working journalists, one prominent reporter for the CBC confided in several of us that she was really left-wing but that no one knew it. She was so unaware of her biases that she didn't know she was one of the people who stood out for us as being extreme left.
Last summer I met a number of people in the park playing Pokemon Go. After a short time, I started playing it, too, and I must confess to being slightly addicted/obsessed with the game. So here is my latest snow stomp art. This is for all the friends I have made and all the friends I have interacted with because of Pokemon Go.
Links to most of my previous snow-stomp art (in reverse chronological order):
Pikachu (this post)