How are we doing with our reading?

“’We are doing a better job of teaching kids to read in elementary school.’ said one national expert. ‘But once they enter adolescence, they fall victim to a general culture which does not encourage or reinforce reading. Because these people then read less, they read less well. Because they read less well, they do poorly in school, in the job market, and in civic life… This is not a study about literary reading. It’s a study about reading of any sort and what the consequences are of doing it well or doing it badly are. In an increasingly competitive world, the consequences of doing it badly include economic decline…. What are the consequences if American becomes a nation in which reading is a minority activity?'”

From "The Five-Year Party" by Craig Brandon.

What do we do about the lies in political advertisements?

There are plenty of lies and exaggerations on both sides of the political isle in our upcoming elections. I am not talking about generalizations like (I believe in smaller government or I will work hard to get rid of waste in Washington). I am talking about statements about a candidate’s claim he served in the Marines or graduated from Yale or that his opponent was convicted of child abuse.

There are organizations like Factcheck.org that do a reasonable job of checking the facts and calling out the liars in these political campaigns. But they only check some of the ads and not enough people verify potentially deceitful ads with the fact checkers to make lying an ineffective strategy today.

What’s the answer? Perhaps a mechanism for a quick appeal to a new independent Fair Campaign Office (FCO). I make this suggestion as a small government advocate. A semi-judicial process would be established for a campaign to get a quick determination on the truthfulness of an ad.

For example, Harry’s campaign asserts in a television advertisement that Harry’s opponent Bill was convicted of distributing child pornography. Bill’s campaign lodges a complaint with the FCO. Both sides then post a bond with the FCO. The Fair Campaign Office can take a number of actions: 1) Require the ad to be suspended until it can be investigated by the Fair Campaign office (if it appears in the initial review as false) 2) The FCO investigates in more detail and determines within a few days if the ad is materially false 3) If the ad is deemed materially false then whatever Harry spent on television spots, he must pay three times that to the FCO (out of a bond previously posted) 4a) One third of these funds go to Bill’s campaign 4b) Another third of these funds would be spent by the FCO to immediately advertise that they have found the advertisement materially false and 4c) The FCO retains one third of these funds for administrative expenses.

The appeal process would be run like the challenge system in the NFL. You only get to throw the red flag twice unsuccessfully in a campaign. If a campaign challenges the truth of an ad and loses the appeal two times then they are done with appeals for the season. Each time a campaign loses an appeal they also must pay the Fair Campaign Office three times the advertising spent on the ads in dispute (out of their bond previously posted). If the appeal is unsuccessful (in other words the ad is deemed truthful), then the FCO keeps one third of this amount for their administration costs, spends one third of the funds to advertise that they found the ad materially truthful and hands over the remaining one third to the opposing campaign.

It would obviously be critical that the FCO had the ability to respond quickly and make fair and objective decisions. So when one of these disputes came up then both of the campaigns would have to provide their supporting evidence quickly as well.

But the two strike rule would apply to the liars as well. If a campaign was found to have broadcast two ads with material false statements then they could only run new ads after they had reviewed the prospective ads with the FCO and the opposing campaigns at least a week prior to running the ad. In these cases the opposing campaign could challenge the veracity of the ad prior to the ad being broadcast.

Finally, during the last few days of a campaign (let’s call it one week), if a campaign ran a new advertisement that was successfully challenged by the opposition as untrue, then the election results would be nullified (if the liar had won) and a new election would be held a month later. The cost of the additional public election would be borne by the lying campaign.

We have rules for compensating those damaged by liars in the general public via libel & defamation laws. These laws compensate the injured party for the injuries created by “liars” that go public with their lies. But in the case of lies in public elections there is no protection for the public and the public ends up with a liar representing them. The liars are rewarded with paid trips to Washington DC.

Historically the voters have relied on the media to independently investigate and expose lying campaigns. But this does not work very well today. Lies spread much faster than the truth and once the damage is done it is hard to undo. And political campaigns based on lies are a major distortion to our democracy.

Definition of an interception!

This is where the statistics lie (OK this is not unique).

On 3rd down when an incomplete pass will result in the offense punting the ball, a deep interception for 45 yards may be better than an incomplete pass. It should not count against the quarterback.

The other stat that needs revisiting is the interception. If the quarterback throws the ball right into the hands of the receiver and he pops it up and the ball is subsequently caught by the defense back, it is labeled an interception. The same interception as when the defensive back is standing all alone and the quarterback throws the ball directly to him as though he was the receiver.

Life is not fair, but we can do better than this.

The Agreement Ratio

I love it when someone disagrees with one of my posts on Facebook or on one of my blogs. But how much do I love it?

I also love it when my friends agree with me. I really don’t want you to agree with me all of the time and I find it particularly annoying if you disagree with me all of the time.

So let’s define a new dynamic called the “Agreement Ratio” as the percentage of times you agree with me. It is 10% if you agree with me 10% of the time and 90% if you agree with me 90% of the time.

Here is my hypothesis. I find it most interesting if this ratio is 50%. You disagree with me half the time and tell me what I am missing. The other 50% of the time you confirm the brilliance of my conclusions.

OK - do you agree with me on this one?

Should private companies control our most precious natural resources (water)?

Interesting article entitled “The New Oil - Should private companies control our most precious natural resources?”

The answer is an unequivocal YES. I am without a doubt a free market guy. I have seen free markets in action and have experienced the innovation and financial strategies that result in far more efficient use of our resources. I have seen this in oil, natural gas, electricity, copper, gold and shipping to name a few. And these free and competitive markets work.

When the government controls the supply then investments are based on politics and not rational economic supply and demand principles. Even though there is a natural monopoly on the last mile of distribution for telephone, electricity or water does not mean that we can not effectively deregulate the supply side. In Texas and much of Europe one can pick your own supplier and pay a transmission charge for the local utility to move the power over the last few miles to your home or business.
Some suppliers charge a simple index or market price for the commodity (kind of like a variable interest loan compared to a fixed price loan). Other companies might offer a fixed price for the commodity over the next few years. But competition in the supply-side of commodities means choice and almost always lower costs in the long run.

In California the biggest user of water by far is agriculture. But under the leadership of the Federal government during the 1930’s to the 1960’s water was contracted to large farmers in what is otherwise desert land. Much of this would have made no economic sense at all if the growers had to pay the market price for the water they were using. And based on these subsidies and below market prices many of these farmers got rich. I am all in favor of people getting rich without subsidies but hate the notion if it happening on the back of taxpayers.

One school of thought is that water is just too important to privatize. But this is where I differ sharply. The more critical the service the more important it is to privatize because it will be done more efficiently and less politically than the government can ever accomplish.

The real critical needs for water come down to clean drinking and cooking water, showers and perhaps a small amount to run our plumbing systems. This is probably less than 10% of all the water used in the US. Virtually all of the rest (agriculture, manufacturing, lawns and gardens, and car washes) are optional. Now I am a big advocate of the US increasing its exports to the rest of the world via agriculture and manufacturing but if we price the water in an open market we will build the most sustainable economy and won’t build it based on hidden subsidies that result in the wrong crop being grown in the wrong place. Perhaps a water intensive manufacturing process should be situated in Sitka, Alaska rather than in the desert outside of Phoenix, Arizona. But if we have open and transparent prices for water, electricity, and natural gas our economy will adjust where and how we do things in a way that is far more efficient than politicians deciding what kind of subsidy they should give to a powerful grower or employer in their community.

Critics of free markets point to the potential for high volatility that we see sometimes in commodity markets like fertilizers, oil and pork bellies. The public is fine when prices drop dramatically but hate it when they go up just as fast. But most free markets allow for suppliers to offer fixed prices that give certainty over a given period (just like one can pay a bit more for a fixed interest mortgage today and remove the risk of interest rates going through the roof). Norway has perhaps the most volatile wholesale electricity prices in the world because the vast majority of the electricity is generated from hydroelectric systems. So in wet years, prices are low and in dry years they can be quite high. Despite this they have an open electric market for every consumer (residential, commercial , agriculture and industrial) that offers plenty of price structures (including fixed prices that remain flat in dry years) and countless suppliers all vying for the customer’s business.

There are ample mechanisms for moving water around the world during those peak periods when one area is having a shortage. From hauling icebergs, using tankers to transport across the oceans, trucking across the country or installing mobile desalination units on the coast. These water peaking strategies are far more expensive than pumping the water from 50 feet below the surface in your back yard. But the free market will figure out a way to solve the problem most efficiently. Plus in a free market, it is far easier to price the payback on demand side investments (like more efficient toilets or energy efficient light bulbs).

Water supply should clearly be deregulated along with retail electricity and retail natural gas. We just can’t afford the inefficiencies of government run (or private utility monopoly) systems to manage these precious resources.

Going through the motions in trying to curb illegal immigration

Here is the letter that the Social Security Administration sent to Meg Whitman and her husband.

The real tragedy is the language in this letter. Last year the Social Security Administration sent out 9 million of these letters. How many of these letters were sent to the employers of illegal aliens? My guess is most of them.

But the letter says “This letter does not imply that you or your employee intentionally provided incorrect about the employee’s name or SSN. It is not a basis, in and of itself, for you to take any adverse action against the employee, such as laying off, suspending, or firing, or discriminating against the individual. Any employer that uses the information in this letter to justify taking adverse action against an employee may violate state or federal law and be subject to legal consequences.” In other words, we would never want you to fire an illegal immigrant.

Does the Social Security Administration cooperate at all with the INS? Our government is going through the motions in trying to curb illegal immigration. It would not be that tough for us to actually do something about it. This is really not rocket science.