Ten-year-old mystery solved

Thanks to Michael Brush at MSN (and the Economist), we now know the answer to a question that has been outstanding since December 1998.

Greenspan reasons that because hardly anyone actually sees a guy’s undies, they’re the first thing men stop buying when the economy tightens. (He told this to National Public Radio’s Robert Krulwich years ago.)

By extension, pent-up demand means underwear sales should be among the early risers when growth returns and consumers feel confident enough to shrug off “frugal fatigue,” says Marshal Cohen, the chief industry analyst with NPD Group, which tracks consumer behavior.

So now we know:

1. Collect underpants
2. Examine their condition, and use the degree of wear as a leading indicator of the price of risky assets, guiding your investment decisions.
3. Profit!

Thank you.

Chris Woodhead

Chris Woodhead, former head of OFSTED, has said that OFSTED is an irrelevance and part of the problem in education.

The quote that caught my eye is that inspection is “an exercise driven by analysis of the data”

I think that is a wonderful point (not that his other arguments are bad). One of the key changes of the last twenty years or so is the large advance that has been made in analysing data, due to cheap computer power and modern statistical techniques.

These techniques are powerful enough to quantify and compensate for a degree of inaccuracy in the original data. However, I fear that demand for data has been met by abandoning quality to a degree few people realise.

This is not just about education. This, after all, is the story of the credit bubble. It is the story of the endless senseless health scares. It is also, I would suggest, the story of climate modelling. In each case there is a machine which demands data, day in, day out. If you don’t have good data, you give it whatever you’ve got.

Never before has so much data been collected with so little concern for its real value. The statistical techniques were initially used on data that had been collected by enthusiasts the way philatelists collect stamps, and they were so successful that they led to the modern hunger for datasets. Surveyors and inspectors now amass raw data by the megabyte, and whether the data is good or bad, their pay is just the same. Once it’s in the computer, and I speak from experience here, it’s always easier and more satisfying to refine the processing than to check the input, but if the inputs are bad enough, the processing is worthless.

Nadine Dorries

Nadine Dorries (Conservative MP for Mid Beds) said the following:

No Prime Minister has ever had the political courage to award MPs an appropriate level of pay commensurate with their experience, qualifications and position; as recommended by the SSRB, year after year.

Prior to my intake in 2005, MPs were sat down by the establishment and told that the ACA was an allowance, not an expense, it was the MP’s property, in lieu of pay; and the job of the fees office was to help them claim it.

I find this quite believable. More, I genuinely sympathise. It is a reasonable explanation of what happened — MPs weren’t paid as much as they and everyone around them thought they should be paid, so “the establishment” found a solution in letting them take money under the table on the additional costs allowance.

That’s a perfectly good explanation to me, but that’s because I don’t believe in democracy. To a democrat, however, MPs are the establishment. If they are not able to pass a law giving them a higher salary, that means the electorate doesn’t want them to have a higher salary. If they conspire with officals to take the extra money anyway, then they are thieves and usurpers.

So here’s the situation: If we live in a democracy, then our MPs are thieves and usurpers. If we don’t, then… what the hell are our MPs? Not anything good, surely.

Dorries’ further point, and the reason her blog that I took the quote from exists now only on Google’s cache, is that the press were in on this all along but the Telegraph decided to blow it open only now, in order to cause a sea change in British Society by getting a few more minor party candidates elected as MEPs, or something. Personally I think having sharks with laser beams attached to their heads would be a better strategy, but there you go.

The real story here is this: MPs did not believe that voters had the right to determine what they were to be paid. MPs did believe that some “establishment” consisting of party whips and civil servants did have the right to determine what MPs were to be paid. The MPs worked for this “establishment”, and not for the voters. Therefore our democracy is a complete fraud. If voters can’t be allowed to decide what MPs get paid, what can they be allowed to decide? If nothing, what are MPs for anyway?

The normal conclusion to draw is what I was told this afternoon by the “No2EU” party (which turns out to be an alliance of the RMT and a few minor leftist parties) — that we need to “restore” our democracy. Of course, I disagree. The voters really aren’t capable of making sensible decisions, about MPs pay or anything else. The conclusion that should be drawn is that we need to abandon our democracy, and the establishment that runs the country needs to stop pretending.

But since most people still believe we should have a democracy, admitting that we don’t is just asking for trouble. Is that Dorries’ point? I don’t think so.

On reflection, she probably believes that we have a democracy that works adequately for everything except deciding MPs’ salaries. It’s a possibility that didn’t initially occur to me, but might make sense to MPs.

MPs Expenses

Let’s bring back blame.

The natural response when something has gone wrong is to find out whose fault it was and, in some way, punish them.

That’s not always the right thing to do. But it’s not always the wrong thing either.

However, within an institution, throwing blame around is unpleasant, and not just for the blamed. It can go too far, so that people are always worried about being blamed for something, rightly or wrongly. Participants in the institution can attempt to shape it by getting other people blamed for things.

We therefore don’t like to blame people. However, when something has gone wrong, some kind of response needs to be made. The natural response today is to say “we have changed the system so that this cannot happen again”.

Sometimes that’s the best response. But if the problem isn’t the system (by which I mean the institutional rules), but the people, then it’s the wrong response.

The current problem is that many MPs have taken manifestly excessive expenses. Therefore, they are now talking about changing the system so this can’t happen again.

This is clearly the wrong response. More than almost anybody, MPs are supposed to be personally responsible for their actions. Their actions were wrong, they were found out. They can be blamed, and again, more than almost anyone else in our society, there is a mechanism for acting on that – it’s called an election.

If the responsibility is moved to anyone else at all, it will be moved to someone less easily blamed than an MP.

The system worked. For once, the people who really are responsible for some problem are the very people who can be held responsible for it. If they are re-elected despite this, so be it.

The only problem with the system was that they nearly got away with it, and indeed did get away with it for a while, before they were found out. But the change that needs to be made already has been made – it’s the freedom of information act that allowed us to find out about the expenses.

Therefore, the only changes to the system that need to be considered are changes to prevent the actions of MP from being kept secret. And, since the precedent has now been set, that means no further change is needed. Any change that allows MPs to keep more secrets can be presumed to be a fix to the problem that they got caught, not the problem that they took too much money.

The problem, as I said, with always finding someone to blame for any problem is that the corrupt can use the allocation of blame to shape the institution for his own ends. But how much more true is that of changing rules in response to any problem. We should be more suspicious of “changes will be made to procedures” than we are of “the people responsible have been sacked”.

And the broader lesson is not anything about forms of system or organisation, it is that we must not expect too much of those who are supposed to work on our behalf. Their personal interests and their group interests will compete with our own, and while our diligence and their openness will help to hold them to our interests rather than theirs, there are limits to this and the limits are not very high. The best we can hope of government is that it will do a few things and get them right.

Previously: MP’s discipline, Cheques and Balances, Margaret Moran

Science in action

There’s a story on the Tunguska Event at Popular Mechanics.

A study suggests that it was caused by a comet that broke off a piece in the atmosphere over the region while the rest of the comet left the atmosphere and carried on back into space. The fireball was caused by hydrogen gas released by the comet, which was previously dissolved in the comet’s ice.

Some points about this story:

It’s really cool. If we could (as they think they might have done) track a comet that had previously hit earth – just wow.

It’s almost certainly not true. It’s guess piled on guess piled on supposition.

That it probably isn’t true is not a criticism. The story quotes another Russian scientist as being “impressed but not convinced”. Me too. Just showing that the theory is consistent with the (little) evidence we have is worthwhile. Some researchers might argue that existing evidence is not consistent with the theory. Some will look for new evidence. If new evidence is found which is consistent with the theory, that will strengthen it.

Imagine if the theory had some obvious political relevance. How would the process work then?

The paper is on arxiv.org

Margaret Moran

An M.P. is supposed to spend time in the constituency she represents, and also in Parliament. Margaret Moran represents Luton South.

Now, it is perfectly possible to live in Luton South and work in Central London – I know, because I’ve done it for over a decade. I’ve spent 2 hours a day, five days a week on a train for that time, costing me getting on for four thousand pounds a year at today’s prices. Note that this is not considered a legitimate expense, so I have to pay income tax on the money I spend traveling.

So I’m a little bit miffed that my MP gets the maintenance of her second home in London counted as a legitimate expense that she doesn’t have to pay tax on. More than that, since the expense is paid by her employer, the state, she not only doesn’t pay tax on it, she doesn’t pay at all.

Now, a bunch of people have been complaining about all this for a while. Good luck to them, but in my merely “miffed” state, I haven’t bothered to join in.

After all, there is one small difference between me and my MP. I chose to live 20 miles from my place of work, her role as an MP means she more or less needs to. So there is some thin kind of argument about her 2-location life being more of a necessary expense than mine. Irritating, but not worth making a huge fuss about.

And now details have been published, it emerges she claimed GBP22,500 for dry rot treatment for her second home.

In Southampton.

OK, now I am no longer miffed.
(For the geographically challenged, Southampton is 80 miles from Westminster, and 94 from Luton)

There is a video of her making pathetic justifications on the BBC. Again, the reason why my employer is not allowed to pay my train fare, even if it wanted to, is because I do not have to live such a distance from my office. There are all sorts of good reasons why I choose to do so, but at the end of the day, I have to pay the fare out of my taxed income because it’s my lifestyle choice.

Moran says that it is essential for her to have three properties because her partner lives in Southampton. Well, guess what. My wife lives in Luton, but that doesn’t mean I can claim the costs of being based in Luton and London as a business expense. It was her choice to come to Luton to run for Parliament, and it is her choice to have a partner who won’t move from Southampton, and reasonable as those choices may be, they are her choices to spend her own money on.

(There was a time when candidates who came to an area in order to stand were frowned upon. I don’t think that’s important – the “local” element of M.P. work is not sensible – but if candidates do want to move from their homes to another area where they think they’ll get elected, they can do so at their own expense.)

Brown and Me

I haven’t signed the “Resign” petition. (Shock! Horror!)

That is not, in fact, because of any respect for him left over from his first term as Chancellor. He does not deserve to be running the government.

But what does it mean to ask him to resign? Either we (a) get another non-entity machine politician from the Labour front bench, or (b) we get a general election where presumably Cameron gets in.

I’m not at all happy with the constitution we have, but having governments chased out of power as soon as they lose the confidence of the media is not likely to improve it. The ousting of Brown would not be a victory in any sense – it would be the psychological substitute for a victory.

If there’s any coherency to my present political position, it is a rejection of psychological substitutes for victory. That is why I can be an activist for the Libertarian Party UK while my guru Mencius writes about “the fundamental comedy of democratic libertarianism – a proposition no less grimly hilarious for its infinite boneheadedness.” Being unsatisfied not just with Tony Blair but also with Gordon Brown, and also with the Labour Party, and also with the Conservative Party, are steps on the road to being unsatisfied with our democracy. Future steps to guide my comrades through are being dissatisfied with democracy itself. I don’t, of course, need a majority to go through this process, but whatever can be done in the end, I’m not likely to do it on my own.

So, if you want to take the system at its word, vote LPUK. After that fails, come with me and Menc….

Climate and Science

Patrick Crozier writes (a couple of weeks ago, but I’ve been distracted) that libertarians should actually talk about the economics of climate change, and that the best defence is rapid economic growth that can only happen through a freer market.

It sounds pretty reasonable. I think, as a practical matter, the association of libertarianism with climate denial is harmful to our public image. We would be better off accepting climate science, and, as Patrick says, dealing with the economics.

The trouble with that, as reasonable as it seems, is that I can’t do it.

At least it solves one thing. I used to worry that my view of the science was being influenced by my politics, that I was hostile to AGW because it was inconvenient to libertarianism, rather than because of its merits. But I find, that if it comes to a choice between libertarianism and climate denial, I’m more convinced of the scientific question than the political one. Libertarianism has bigger problems than Global Warming. (In a word, democracy)

Indeed, and this is yet another point due to Mencius, I would say that in the long run, the closed loop of “official science” is the biggest problem of the managerial state. I was trying to work up to this gradually before I got sidetracked.

Frankly, if I was to rely only on work produced within the last 50 years, I wouldn’t believe in evolution. It’s only the work done before the state took over all science that convinces me (and the fact that it’s simple enough that I can work through it for myself). By the time we finally give up on global warming (in 25 years or so), science will be so utterly discredited that it will be irrelevant – gone the way of theatre, or sittings of the House of Lords – something that is still done because the state funds it, but nobody can quite remember what the original point was.

Retreat into history

The reason I’ve gone very quiet of late is that two weeks ago I visited Bletchley Park, and was so fascinated by the details of the cryptanalysis of Enigma that I’ve spent every spare moment since working out the crib/bombe technique, and implementing software simulations to verify my understanding.

I had what I think was a working bombe simulator by last weekend, but running in ruby on my netbook, it was somewhat slower (for a moderately complex menu) than the 1942 electromechanical version. Not having the resources of a state war machine to draw on, that makes it a bit too time-consuming to actually test the process. Every optimisation I attempted made it slower, so I have resorted to a C++ port of my ruby code, which is not yet complete.

(I am aware that many simulators already exist – the point of my simulator is to demonstrate to myself that I know how it is supposed to work).

There’s loads of important stuff to write about, but I just can’t put this down right now.