Author Archives: Eapen Thampy

Apr 09 2010
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Economics, Models

An extended thought on arms races

Reading over my previous post on nuclear deterrence and President Obama’s Nuclear Posture Review, I was immediately struck by the thought that it was incomplete. Part of the reason why I think nuclear weapons are becoming less important is because other technologies are becoming more important, or at least more relevant.

This world has already seen many arms races, and to-date the nuclear race has been the most important. But the arms race never stops. Nuclear weapons aren’t perfect weapons in the sense that they are relatively blunter and less precise than other technologies, or at least the promise of other technologies.

I suggest that while nuclear power will always be extremely relevant and nuclear weapons will remain the weapon of choice for ending the existence of all life on this planet, the true arms race has shifted to technologies that allow strategic micro-targeting. Predator drones represent but one facet of this direction; other directions include the military applications of sophisticated robotics, nano-technology, and bioengineering.

Perhaps one reason why America is willing to push for a nuclear-free world is because we are close to another game-changer, or because we already have one. In this world nuclear weapons don’t matter because other technologies provide effective countermeasures and the investment in nuclear weapons systems represent forgone opportunities to develop or build other technologies.

In any case, this is part of what I think the President’s Nuclear Posture Review signals.

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Apr 09 2010
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Economics, Models

On the Nuclear Posture Review and deterrence

Some thoughts that I’ve been having on President Obama’s negotiations with Russia over the number and status of our collective nuclear stockpile:

America is currently negotiating from a position of strength. This is true partly because the assumptions that have to be true for the theory of Mutual Assured Destruction (MAD) to exert a sufficient deterrent effect are no longer true: America has nuclear primacy, which means that we possess the capability to unilaterally first strike without the prospect of retaliation.

The signal that we are willing to reduce our nuclear inventory (from a President who has spoken openly of a nuclear-free era) is not a signal of weakness. Rather, it is a signal of utter confidence, and America’s enemies will take it that way.

Consider, by way of why this is true, the Predator drone. Unmanned drones offer us overwhelming conventional superiority because they allow us total control over a battlefield. It is not just the Taliban or Al Quaeda that should be making calculations about how viable they are in a world where drones see everything, it is the Russian and Chinese and North Korean militaries (and really, every potential enemy). Consider when unmanned drones are vastly cheaper for the US and more sophisticated in terms of the armament they’re used to deploy. In this world, no nation can claim the ability to control its airspace; squadrons of drones can infiltrate any airspace and stay radar-neutral, providing a blanket of offensive might that can completely neutralize entire nations. In this world, the option value of having nuclear weapons is increasingly offset by the prospect that unmanned drones can be anywhere, anytime.

Also consider that the US now has a dominant technological edge in military development. The collapse of the Soviet Union heralded the collapse of its military-industrial complex, and now the Russian scientists that are left mostly ply their skills elsewhere, leaving China and India as the only countries with the infrastructure to attempt to compete in this arena. I discount India as a strategic threat to the United States and think it unlikely that the Chinese alone can reach comparable levels of technological sophistication without the benefit of at least another decade. One might even reasonably assume that the next game-changing technological breakthrough will also be American.

Additionally, a world free of nuclear weapons is not a world free of nuclear technology. In a disarmed world, the nuclear threat is represented mostly by the prospect of a race to re-arm, a race in which America holds a dominant edge; even a timeframe of 24 hours to 48 hours represents a timeframe in which American air superiority, both manned and unmanned, is completely dominant.

The President’s formal declaration of the conditions under which nuclear weapons will be used is also a powerful factor in this equation. Now American enemies cannot use the argument that American nuclear power threatens non-nuclear states to muster support; at the margin, this makes the spectre of American military superiority more palatable to other nations and decreases the perception of America as a nuclear bully.

By committing to limiting our use of nuclear weapons, we implicitly signal that America is committed to maintaining our overwhelmingly superior conventional deterrent. Those that argue that nuclear weapons prevent the escalation of regional wars and that a nuclear deterrent is critical to maintaining peace were correct in the immediate aftermath of World War II; their assumptions are no longer true today.

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Apr 08 2010
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Intelligence, Language, Literature

Margaret Atwood on Twitter

From The Guardian:

So what’s it all about, this Twitter? Is it signalling, like telegraphs? Is it Zen poetry? Is it jokes scribbled on the washroom wall? Is it John Hearts Mary carved on a tree? Let’s just say it’s communication, and communication is something human beings like to do.



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Apr 08 2010
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Economics, law

Henry Hyde on property rights and civil asset forfeiture

From Forfeiting Our Property Rights by former Representative Henry Hyde (R-IL), published 1995 by the Cato Institute, page 3:

Before going further, I think it appropriate to consider the basic principle that unchecked forfeiture undermines–the right to private property–and why that principle is so important in America, or in any just society. True, we are dealing with an abstract principle we usually take for granted, but the right to own and enjoy property protects and enhances the lives of all citizens. Without it, human being are reduced to misery and want. The stark reality of this truth is never so evident as when a squad of government agents breaks down your door, guns drawn, and confiscates your family home. That might sound dramatic. But too often that is the reality of modern American forfeiture law.

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Apr 08 2010
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Economics

On ”Anchor Prices”

From The Simple Dollar:

I have a quick four question quiz for you to run through in your head. Just give your snap response to these – don’t think about each one too much.

What is a wedding supposed to cost?
What is an automobile supposed to cost?
What is a home supposed to cost?
What is a three week vacation for a family of four supposed to cost?

For each of these questions, you came up with a number of some sort. That number is based on your own life experience coupled with what you’ve observed others doing and also the influence that media has had on you. That number, in other words, is your “mental anchor” for what that item should cost – and it’s often the basis of judging whether something is reasonable in price or not.

Of course, anyone who has read The Simple Dollar for long probably recognizes one thing immediately: that anchor price is nothing more than a sticker on the box. It doesn’t represent what you’d ever actually need to or have to pay.


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Apr 08 2010
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Economics, law

A thought on legal regimes, legislative processes, and evolution

There is much debate over the European social model, how well it works, and how desirable it is. What is interesting to me is how it came about. I suggest that part of the reason might lie in the institutional infrastructure of these European countries and is a side effect of poor institutional design.

Let’s start with some intuition about legal regimes. Legal regimes are generally categorized in the literature under the two main strains of common law and civil law regimes. There are variants of each, but the important differences are in how each regime is structured. Common law regimes are based on English common law and works this way: legislatures make laws and judges have wide latitude to interpret these laws in context of specific cases. In this way the majority of the actual law is case law, which we can also call judge-made law. Inherently I think there are two advantages here. The first is that common law regimes are more responsive to exogenous shocks and citizen demands because judges can interpret and apply laws contextually. The second advantage is that one can take broad principles, like freedom of speech, and apply them easily. Civil law regimes are based conceptually on the Justinian code and finds its most prominent expression in France, whose civil law regime was heavily influenced by the Napoleonic code. In civil law regimes, the law, whether principle or rule, is codified by a legislature. In this setup judges have vastly less latitude and adjudicate on a bright-line basis. Case law in this institutional paradigm is vastly less influential where it exists at all. The disadvantage here is that the law is vastly less responsive to exogenous shocks since judges do not have much ability to interpret these laws contextually.

So the next intuition is how policies are formed and wrongs redressed in civil law vs. common law regimes. On a broad, theoretical level, my intuition is that common law regimes are less likely to have legislation redress wrongs because citizens have options in courts. Consider two nations, one with a civil law regime and one one with a common law regime. In the nation with common law, citizens faced with uncertain legal footing due to technological change can obtain rulings to extend and clarify laws like the 4th Amendment, for example. In the civil law regime, the laws are inflexible, and citizens cannot obtain the same rulings in a court of law; their option is to enact new laws. In this second nation, the legislature is thus vastly more important. Laws are inflexible, so they must be changed, and legislators are put more often into the position of forecasting from afar the impacts of the legislation they propose based on singular datapoints.

The more active a legislature is, the more policies it enacts and the more money it spends. Additionally, legislators are often unqualified to actually write and interpret laws, which require sometimes substantial legal education and intellectual sophistication. The claim is that legislators are worse at writing laws to respond to exogenous, far off shocks than judges are at creating case law based on immediate, contextual information. Additionally, independent judges are often circumscribed by what they can do; though they can rule on the legality of specific issues they cannot create entire social programs to respond to systemic issues. But legislators can…and there are lots of legislators, both liberal and conservative, whose first instinct when approached with a problem is to think how a government program might be a solution.

So the claim is that civil law regimes are much more susceptible to policy-making by legislatures, which in Europe particularly has resulted in nations designed to legislate problems rather than adjudicating them. This results in the inevitable growth of social programs as citizens are constrained in their options when seeking responsive and flexible legal relief from the judiciary and are forced to pursue legislative relief.

Let me note here that I know I haven’t presented any data here; the argument I wanted to make here is analytical, not empirical, though I do have data that I’ll present in later posts on the subject.

Hat Tip: I am indebted to many fruitful conversations with Ron Harstad on the subject several years ago as well as conversations with Abhi Sivasailam more recently.

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Apr 08 2010
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Economics, law, politics

Against civil asset forfeiture, Part I

During my sophomore year in high school, I competed in policy debate. My partner and I chose to run an affirmative advocating the end of the system known as civil asset forfeiture, a relic of ancient English common law that has made an ugly reappearance since the passage of the Racketeer Influenced and Corrupt Organizations Act (RICO) in 1970. This topic has always remained on my radar and since that debate topic I have kept current with both the literature on the subject and have written several essays against it.

The basic premise of civil asset forfeiture is that under a truly ancient and archaic legal theory, the government can level a charge of being the product or accessory to a crime against property itself. Note that this completely changes the game. In criminal prosecutions, the government has the burden of proof and is held to a standard of reasonable doubt. Additionally, defendants enjoy numerous (though not always sufficient) protections, like the right to counsel and the right to due process. In civil actions, and particularly in a civil forfeiture action, the government only has to establish a preponderance of the evidence in order to obtain a forfeiture.

Note the trick here. A preponderance of the evidence standard is something that few people are familiar with, in part because it’s used as a criteria for adjudicating guilt so rarely. But consider the trap this puts an innocent person. The government seizes an asset on some arbitrary charge and provides an informant’s affidavit as evidence. An innocent citizen now has to prove a negative in order to retain the rights to their property by providing evidence of superior quantity and quality. This is nearly impossible for citizens implicated in the vast majority of civil forfeiture actions who now have to prove that their property (not themselves) are innocent. Additionally, since the forfeiture action vests against the property, not the property owner, the owner’s complicity in the alleged crime is actually irrelevant.

Imagine a paid informant provides evidence that a black man of some variety will be transporting a large amount of cash for a criminal activity through a certain town. On the strength of that reasonably vague affidavit, the police can stop and search almost at will. If they find a black man actually in possession of a large amount of cash, the affidavit constitutes probable cause for the seizure and evidence for the forfeiture action, regardless of whether or not the man is a criminal or the cash is for illicit purposes. The property owner now has to provide evidence that outweighs a sworn affidavit describing in generic but apt language the suspicion vested by the police on the strength of an informant who has no accountability for his testimony and is paid to provide the police with justification for warrants. In this case, this means accounting for the cash in every last detail of where it was from and where it was going. Generally, this is a costly prohibitive burden on the politically weak, particularly when traveling. One must deal with the expense of travel and the opportunity costs of having to be in other jurisdictions for proceedings, along with the cost of an attorney and the cost of proving impossible negatives.

In other words, this forfeiture can happen without the DA ever filing a charge. The calculation now is: we found a criminal and took his cash and we don’t even have to go to the expense and trouble of prosecution. The informant is even eligible for a cut of the seized property. This presumably exists to incentivize criminals to turn their associates by holding out the promise of financial gain. Note that when there is no check on informant credibility, this is a system that can be gamed by criminals for money.

It gets worse.

So many states have laws specifically deeming that the proceeds of forfeiture return to specific general funds, like education or healthcare. So police departments should have no incentive to seize without really having probable cause, right? Wrong. The federal government in many cases helps state and local police agencies subvert their own laws through a clever loophole. The loophole works like this: the state police find an asset in an appropriate situation where forfeiture is easy and unlikely to be contested. They then ‘detain’ the asset until a federal agent arrives and initiates a seizure under federal law. The asset is then liquidated and the local police get a kickback that is usually around 80% and goes straight to their budget.

In one fell swoop several fundamental checks and balances are cut out of the picture. First, there is the obvious dishonesty and travesty of letting one level of government actively subvert the will and intent of another level. Second, this allows police departments to become in theory self-funding, which eliminates the legislative check on executive power, since the legislature’s control of the public funds now becomes meaningless. This is a subversion of democracy that happens on both the state and federal level.

This is the first in what I intend to be a series of posts on this subject. Later posts will explore the specific constitutional violations that accrue through the use of civil asset forfeiture, the harms of letting police departments self-fund, and several other nuances to this story.

I am indebted to Mickey Klebanov, David Kramer, and Eric Kafka for the numerous conversations we had on this topic.

Addendum: Ilya Somin at the Volokh Conspiracy blogs about civil asset forfeiture here. Recommended.

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Apr 07 2010
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books

The most influential books in my life

Tyler Cowen posted a list of books that had influenced him the most some time ago; the list, like so many other memes on the internet at the right place and time, went kind of viral. Here are lists from Peter Suderman, E.D. Kain, Arnold Kling, Michael Martin, Niklas Blanchard, EconJeff, Bryan Caplan, Matt Yglesias, Jenny Davidson, Will Wilkinson, Matt Continetti, Ross Douthat, Mike Konczal, Kieran Healy, Ivar Hagendoorn, Scott Sumner, and Steve Landsburg.

This is of course my non-definitive list. Now that I’m about to post, I want to add another 10 books to the list but…maybe later.

Godel, Escher, Bach: An Eternal Golden Braid by Douglas Hofstader: I have so much to say about this single text, which has informed my thinking more than any other single work, that I feel overwhelmed. But let me start by saying that the notion of Godellian incompleteness has deep and rich connections to every study or topic I am aware of. Through it I began thinking of the world in terms of systems and interactions and over time many things became obvious to me later on as I would take upper level mathematics course on chaos, nonlinear dynamics, and fractal theory, along with engaging the many related ideas discussed by Stephen Wolfram in his work (best represented by A New Kind of Science). I have lately begun to ask questions about economic systems in this light and considered modeling economic interactions using large scale cellular automata.

GEB has given me the intuition to ask questions about for instance the computational equivalence of different economic or legal systems. It has also forced me to reject classification systems based on strict hierarchical architecture because as systems get larger and more complex hierarchies tend to break down.

Les Miserables by Victor Hugo: I first read the abridged version on Christmas when I was 15. It took me an entire day, and later on I would find that the book was actually 6 books and available freely online. I was attracted to both the language (the english translation remains remarkably good) as well to the sense of rigor and coherent analysis I found in the historical parts of the novel (which are dense, prosaic, and effusive). Hugo was remarkable to me because overtly this is a very simple, though well-developed story; under the surface there is a richness of texture that comes from the fluid comprehension and description of the human condition. To this day the chapter on love (Marius’s first aphoristic letter to Cosette) remains one of my favorite passages in all of literature.

Power/Knowledge, Michel Foucault: I don’t know if there is anything intrinsically new in Foucault, though it is certain that his was the first real coherent expression of ideas that others had never really dealt with systemically or from a multi-disciplinary perspective. Namely, Foucault talks about things like power, which is a subject that demands analysis from more than one perspective. Foucault’s dictum that power and knowledge were coterminous were revelatory to me both in an epistemic sense, but also because he didn’t dodge the obvious endogeneity nor did he let its existence hinder his understanding of it. I find Foucault’s ideas on micro-politics and relational rights to be strangely libertarian in content though not in form. Notably, my engagement with Foucault and critical theory came immediately after my fling with Ayn Rand and Objectivism, an ideology that I found sorely lacking.

Nausea by Jean-Paul Sartre: My first true experience with literature that engaged on multiple levels. Part of it is because the book is so strange in character and tone beyond my experience, yet I found it profoundly moving. The alienation that the main character experiences was at the time something my younger, angsty self found fascinating, partly because a young angsty person really wants something to identify with. But there are nuggets of insight that have stuck with me through several paradigm shifts. I would eventually give up on Sartre, who I found grew increasingly obtuse as he aged (Being and Nothingness, anyone?). I also felt that he was too enamored with himself, which was a turnoff, and he ended up in the Marxist intellectual trap, which is to use an inconsistent system to explain everything away. (One of the marks of a good paradigm is it tells you where you are confronted with unknowable propositions).

Love in the Time of Cholera by Gabriel Garcia Marquez: Really one of the more perfect novels I’ve ever read.

Ada or Ardor, A Family Chronicle by Vladimir Nabokov: Nabokov is one of the most wonderful writers in the english language. The one thing I can share here is that reading Nabokov is difficult because of his utter fluency and intimacy with words and language and, well, most of us aren’t used to that.

An Inquiry Into the Nature and Causes of the Wealth of Nations by Adam Smith: Perhaps cliche, but Adam Smith really does have something to offer us that was unique in all of recorded human thought. Here, finally, was a framework for beginning to understand the nature and dynamics of human systems.

Nonlinear Dynamics, Chaos, and Fractal Theory by Steven Strogatz: My working reference book is now a much thicker and mathematically complex text, but this was my introduction to the mathematics of systems and interactions. You don’t need much beyond a basic understanding of differential equations and a working knowledge of trig and calculus to be able to work with this text.

The True Believer by Eric Hoffer: I strongly believe that Eric Hoffer’s short text should be required reading for social studies in high school and political science majors and journalists (specifically) in college. His thoughts on the nature and features of mass movements are clear, insightful, and extremely relevant.

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Apr 03 2010
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Economics, Intelligence

Petraean Signalling Theory

From Vanity Fair:

He still steers the Iraq war, and he oversees the developing strategy for routing the Taliban in Afghanistan. The all-out assault on Marjah in February demonstrated strict Petraean principles in action. It was announced months in advance, which gave civilians a chance to either dig in or clear out. There were civilian deaths, tragedies that were clearly inadvertent and which McChrystal publicly apologized for, but the numbers were a fraction of those common in such urban assaults. By so carefully reducing the potential for civilians to be caught in the crossfire, the offensive all but eliminated what is, perhaps, the strongest incentive for Taliban troops to stand and fight: to exploit such deaths to turn public opinion against America. Since they could not hope to defeat the onslaught of allied and Afghan troops, the insurgents largely melted away. The end result was the same: the allied and Afghan forces reclaimed Marjah, but they did so with relatively little bloodshed. This approach runs directly counter to military convention, which prizes secrecy and surprise. It recognizes that the real battle is not chasing the Taliban out of the city or underground but winning the population, a process which can begin only after the city has been retaken. American commanders have already announced an even larger offensive for later this year, on Kandahar.

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Apr 02 2010
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Economics, politics

Senator Orrin Hatch’s aides say dumb things about game theoreticians

From the WSJ:

In classic game theory, confrontation is sometimes necessary when cooperation breaks down to present a credible potential threat and get the two sides to re-engage, said Robert Axelrod, a University of Michigan political scientist and author of the game-theory book, “The Evolution of Cooperation.” He isn’t related to White House senior adviser David Axelrod.

The Senate doesn’t work the way game theorists think, said Antonia Ferrier, an aide to Republican Sen. Orrin Hatch of Utah. A body built on personal relationships is likely to spiral into endless tit-for-tat retaliations in the face of Mr. Obama’s new turn, she said.

Ms. Ferrier’s ignorance and willingness to make claims about she doesn’t know anything about is so painfully bad, it’s funny. For those who aren’t in on the joke, Robert Axelrod, yes, THE Robert Axelrod, seminally important political scientist who did much of the foundational work in applied game theory actually did discuss the tit-for-tat strategy in his work with Anatol Rapaport (a Russian mathematician) in 1980. Here is more abut the tournaments, in which tit-for-tat was the dominant, winning strategy.

So yes, Ms. Ferrier, game theorists do have insights into how the Senate works, and it’s unfair and really dumb of you to say that in response to the person who actually did all this work that you’re ignorant of.

Recommended: Axelrod’s The Evolution of Cooperation is one of the seminal texts in game theory and I am currently reading his earlier contribution, Conflict of Interest, which has a lot of to offer to the study of political coalitions.

Addendum: Here is a biography of Robert Axelrod by the indomitable Elinor Ostrom, one of our newest Nobel Laureates in Economics.

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Apr 01 2010
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politics

In defense of Jonathan Sessions, re: Sarah Brodsky

I anticipate this post will get a fair amount of attention, so a little background first.

Jonathan Sessions is a friend of mine who owns a local tech firm (Tech 2). He’s a young, intelligent person, who has a very focused and particular vision of how Columbia Public Schools should adapt for the future. I have donated both time and money to his campaign and encourage you to vote for him in the Columbia city elections April 6th.

Jon was recently interviewed by the Columbia Tribune regarding his thoughts on school lunch. Here is the relevant excerpt:

Tribune: Do you feel a responsibility as a school board member to ensure school lunches include more whole grains, fruits and vegetables, and fewer high-fat, high-sodium and sugary foods?

Jon Sessions: It is clear to me that CPS Nutritional Services has made a priority of, and is already delivering, school lunches with whole grains, fruits and vegetables. Fullum recognizes the correlation between healthy eating habits and fighting diseases like heart disease and diabetes. Nutritional Services is working with vendors to provide food and educational opportunities from local food producers and farmers to reduce the impact CPS has on the environment and to educate students about where their food comes from. I believe these food and educational opportunities will help students creating healthy eating habits. The board needs to support Fullum and her team’s plans to continue to provide nutritious meals for our students. Continue reading →

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Mar 30 2010
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Economics, pop culture, Travel

China line of the day, lil Wayne edition

From the NYT:

“People are coming with entire bags full of cash,” said Raymond Hau, general manager of the Sun Valley Golf Resort, which is building the 220 luxury villas. “I’ve seen this myself. A man had a bag and unzipped it. Boom. ‘Here’s the deposit,’ he said. ‘I want two apartments.’”

Mr. Hau shook his head. “It’s crazy. It can only happen in China.”

The golf resort is popular with the privileged. The president of Kazakhstan shot a hole in one here. And on a recent afternoon, when an attendant opened the passenger door of a black sport-utility vehicle that had just pulled up, a pile of large-denomination Chinese bills fluttered to the ground.

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Mar 29 2010
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Uncategorized

Assorted Links

Today’s assorted links post is a selection of interesting reads from my blogroll. Enjoy.

1. Alanna Bauer on bigotry and equality.

2. Jimmy Li on perception.

3. Niki DeWitt on hypochondria.

4. Adam Ozimek: Can the Tea Party be pragmatic?

5. Michael Roberts on the relationship between weather and agriculture markets.

6. Josh Smith on why the earnings tax in St. Louis and Kansas city is bad.

Mar 28 2010
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Economics

Optimal location decisions for entrepreneurs

Published in the NYT, found here:

Though Uruguay’s small size is a handicap in trade with its Latin neighbors, Brenner says that for entrepreneurship, “being small is an advantage.” Companies are unlikely to get rich off of just selling in Uruguay, so they are forced to compete globally from the get-go. He sees an analogy with Israel, another place where the domestic market for numerous well-reputed tech companies is a mere afterthought. Brenner in fact got his start in Israel. While living there, he co-founded Breezecom in 1993, a pioneer in wireless LAN networks and played a key role in developing the initial IEEE 802.11 protocol, according to Phil Belanger, a founding member of the WiFi Alliance. Breezecom set up one of the first Wi-Fi access points in the world, so Brenner is accustomed to creating new market opportunities without being restrained by geography.

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Mar 27 2010
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Uncategorized

Thoughts on Margaret Atwood and Arundhati Roy

At Marginal Revolution, Tyler Cowen responds to my request for thoughts on Margaret Atwood and Arundhati Roy.

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