http://abcnews.go.com/Technology/story?id=5951979&page=1
The only time women are not attracted to intelligent men is when they have the option of a good looking guy who is dumber than pants on fish. Still, it's comforting to know that given the choice of two ugly guys, women usually prefer the one who is not a moron. And obviously many women will still pick the guy who is both ugly and stupid if he has lots of money, good hair, is tall, or plays in a band. I did my own study to reach that conclusion. It's titled "Duh."
In my vast experience as an unattractive smart guy who was not always a syndicated cartoonist, there are in fact women who have fetishes for smart men. Not many, but they exist. My guess is that about 3% of the female public is in that group. That's probably good enough to keep the inventions flowing for a few more evolutionary steps.
The only risk to the future of humanity is that nerds will invent a technology that is better than sex with another human being. I'll try to keep this next part rated PG-13, so please be patient with the indirectness.
I assume some entrepreneur is already working on creating a business where guys will be able to buy a lifelike female body part that plugs into a standard USB port, and can be controlled by someone else across the Internet. That artificial body part could mimic a hand, mouth, or woo-woo. In the short run, the business model would involve paying women, in countries where such things are legal, to control the device and appear on a web cam chat. In the long run, artificial intelligence and CGI women will be controlling the action, so the whole system would only cost $100, with no recurring fees. And that will be the end of humanity because nerds will stop mating, their genes will die out, humanity will revert to the Bronze Age, and all the attractive, dumb people will be eaten by wild dogs.
I like to end on a positive note, so let's take a moment to be happy for the wild dogs.
Viewed in that light, the unwealthy are more like an investment opportunity than a tax burden. If you can make the poor and middle class more educated, healthy, and better employed, everyone wins. That makes sense, to a degree. But would the wealthy gain enough financially to make the extra taxes a good investment? I wonder if that has ever been studied.
Perhaps there are too many variables to make any kind of general statement about the benefits of taxing the rich. If the government raises taxes on the wealthy and pisses away the money on sketchy wars and pork, that's probably a poor investment. If the money goes into education, healthcare, and alternative energy, that starts looking a lot more like an investment with a 10-year payoff.
Obviously higher taxes on the rich are counterproductive if it stops them from building new factories, or causes them to invest overseas. Maybe corporate taxes have to remain low no matter what, or everyone moves their operations to Ireland. You can always tax the individuals, since most people won't leave the country just to save money on taxes.
Henry Ford famously paid his factory workers more than the market rate so they would be able to afford cars. I've never seen a study of how that worked out for him. Does anyone have a link to tell me if investing in poor people benefits the rich?
This raises an interesting question: What did the lenders know about the borrowers that the borrowers did not know about themselves?
In theory, the people who got loans from the so-called predators had enough monthly income to pay the mortgage plus their other living expenses. The real risk was that the borrowers would become sick, unemployed, unlucky, or irresponsible. Apparently we expect lenders to be better judges of the strangers asking for loans than the would-be borrowers are of themselves. How did the conversation between lender and borrower go in the old days, before predatory lending?
Banker: "Well, Billy Bob, you can afford this loan now, but based on that dumbass hat you're wearing, I give you two weeks before you drink a case of beer and drive your Chevy into a silo."
If a potential borrower has the monthly income to repay a loan, how much external risk should the banker accept? I think it's somewhere in the 2% range. In other words, a good banker should turn down a loan for someone who has a 2% or greater chance of being doomed during the early years of the mortgage, before any equity has built up.
Lenders should be required to assign a doom factor to all loan applicants, like a fortune teller. It would be interesting to know, for example, that Wells Fargo has assigned a 20% doom factor to you. Then you could find out on the same day that you aren't going to own a house, and you have a 1-in-5 chance of becoming a hobo by 2010.
In one of my earlier career incarnations I was a banker. My job for a few years included reviewing and approving commercial loans for doctors and dentists. One day I declined a loan application for a dentist who, according to his recent tax returns, didn't have enough cash flow to repay the loan. My boss at the time reviewed my work and turned the decline into an approval without even looking at the financials. When I asked why, he explained that the borrower had a Chinese name. I questioned the wisdom of this lending procedure and he directed me to the files of delinquent borrowers, challenging me to find any Chinese names in there. There weren't any. I'm not judging, just telling you what happened.
Suppose the government passes a law requiring all relatively wealthy people, defined in some practical way, to buy extra crap they don't need from local providers. The relatively wealthy could dine out more often, buy some extra shirts, get a flat screen TV for the garage, whatever.
The result would be a stimulus to the economy that would lift all boats and fill the government coffers. The relatively wealthy wouldn't feel so bad about this form of tax because at least they end up with more shirts and flat screen TVs. This is the same principle as the $600 tax rebates, in terms of fiscal stimulus. But it wouldn't increase the deficit.
I know, I know, you will point out that our shirts and TVs are made overseas. But the local merchants get their markups, and that helps.
The best part of this clearly impractical plan is that the rich would have lots of options on how to spend their money. There is a lot of science supporting the idea that having freedom of choice is essential to happiness. I would be happier spending $100 on two shirts I don't need versus paying $50 in taxes and having no control over how it is spent. Everyone wins.
The hard part is figuring out how to measure this "extra" spending compared to the baseline, so you can be sure the relatively wealthy are complying. So perhaps it needs to be voluntary, like recycling.
I can imagine a new sort of credit card that is used only for the "extra" purchases, provided by the usual banks and credit card firms, but with one important feature: Everything you use the card for is public record, on the Internet.
I am convinced that the main reason people comply with recycling is that their neighbors can see who is being a good citizen on trash day. Peer pressure is important.
Obviously you wouldn't use the special credit card for beer and condoms, because the neighbors would be watching, or could be. I think this would induce people to buy harmless additional consumer items, or take extra domestic vacations, or buy extra birthday presents for friends.
Yes, this idea isn't practical. But how are the other plans looking?
http://www.nytimes.com/2008/10/01/business/economy/01leonhardt.html?_r=1&oref=slogin
I like the clarity of that explanation, but it seems incomplete. For one thing, there is no discussion of the positive aspects of a financial calamity, for example:
- Rent gets cheaper when housing prices fall. That's a redistribution of wealth from the rich to the poor.
- While it will be harder to get a mortgage for an $800K house, that house is only worth $500K now. That should make it a lot easier to qualify.
- Gas at $4 per gallon is a necessary condition for creating the next economic boom: renewable energy and green technology.
- A good recession now and then is necessary to purge the economy of things that need purging.
- College students are starting to choose technology majors over finance majors, probably because of the financial headlines, and this bodes well for the future.
I also wonder if the Internet will take some of the steam out of a credit problem. The problem is a lack of credit, not a lack of people who want to borrow, or a lack of money to lend. When lending is constrained by geography, you might find that your local bank is unwilling to help you. But with the Internet, it seems we could always find a match between a lender and a borrower, at some interest rate. The people who have money to lend aren't going to be keen on the stock market or real estate for awhile, so there should be plenty of capital for private lending at attractive rates. Arguably, banks are an anachronism anyway. This might speed up the inevitable.
I own some real estate (an empty lot) I have been trying to sell. Every recent offer on the property has included a component of seller financing. I expect to see a lot more of that if bank lending dries up.
And allow me to leave you with a pinch of optimism, just because I can. I call it Adams' Rule of Obvious Calamities. It states that any calamity that is foreseeable by the public at large won't turn out so bad after all. The best recent example was the Y2K problem, where computers worldwide were expected to fail. It seemed impossible that those issues could be resolved in time, but they were.
The problems that hit hardest are the ones that sneak up on you. Our current financial problem is big, but I expect a recession to be mild and even useful, precisely because so much human energy and attention is being focused on the fix.
I wasn't truly scared until I saw on the Internet that Michael Moore has waded into the economic discussion. When citizens start getting their economic guidance from Michael Moore, well, that is a harbinger of doom. But the worst part is that I'm not entirely sure he's wrong. Stay with me on this.
There is a growing school of thought - let's call it the Michael Moore school - that the $700 billion dollar so-called bailout is intended primarily to enrich the already rich. To me, that sounds like a cartoon characterization of a complex situation that couldn't possibly be accurate. On the other hand, a year ago if you told me the entire economy depended on making loans to people who couldn't repay them, I would have dismissed that too. So I am reluctant to dismiss ideas just because they sound crazy.
Let's pause here to acknowledge that any governmental action to maintain the health of big banks, and the economy in general, will benefit rich people the most, simply because they have more money on the line. That's how capitalism is constructed. The relevant question is whether lower income people also gain by the $700 billion bailout.
Viewed in terms of suffering, it seems obvious that rescuing the economy helps low income people the most. A billionaire who becomes only a half-billionaire doesn't suffer as much as a factory worker who loses his job, or has to pay more taxes, or gets devoured by inflation. So if the price of helping the factory worker is that some rich people get richer, that's unavoidable under capitalism.
Lately I have been hearing that the $700 billion should go directly to help the people who need it, not to help the greedy corporations. In other words, the government should borrow $700 billion from the taxpayers and then give it back to them. I think that is the kind of thinking that caused the problem in the first place. Unless this is just another way of saying the government should transfer a huge amount of money from the rich to the poor in one fell swoop. If that's the plan, let's call it what it is, and debate it clearly.
What seems missing in all the discussions of the bailout is some sort of description of what is likely to happen if we do nothing. Personally, I am not persuaded by hand waving and vague pronouncements of doom. I'd like to see the risk illuminated a bit.
For example, is the risk primarily to a number of big financial institutions that wouldn't be missed by anyone but the stockholders and employees who signed on for the risk? Or is the failure of those companies just the start of a process that would inevitably cause a great depression? I have no idea.
Does anyone have a link that describes what probably happens if the free market sorts out things on its own?
http://hometownhollywood.com/2008/09/70-famous-dyslexics/#comment-87
I don't understand why having something in common with famous folks is supposed to make people feel good, but it does. Heck, it worked for me, and I'm on the list. So I tried to reproduce the feeling by seeing what other lists I am on. I found a few surprises. I listed them at the bottom.
This made me think that a good web site would be "famous people who are like you." It could start with famous people who have the same birthday, graduated from your school, once lived in your town, have the same sort of dog, watch the same TV shows, had your same profession at one time, committed the same crimes, are the same height, played the same instruments or sports, and so on. If you are like me, you will feel comforted knowing there are lots of famous people who have things in common with you. It's a shallow feeling, but a good feeling nonetheless.
The website would be extra cool if you could paste your own photo into the list of famous people, and create a web page, or print it out. Someone please go build that website.
Here are some more of the lists I discovered that include me.
Famous Mac Users (I switched to Windows years ago.)
http://www3.bc.sympatico.ca/greenacres/macusers.htm
Famous Unitarians (even though I have never been one)
http://www.unitarian.co.za/famous_unitarian_universalists.html
Famous Mensans (I stopped paying dues in the eighties)
http://en.wikipedia.org/wiki/List_of_Mensans
Famous Vegetarians
http://www.happycow.net/famous_vegetarians.html
Famous Economics Majors
http://www.marietta.edu/~ema/econ/famous.html
There is not yet a list of famous people who are CostCo members, but I could be on that list too:
http://www.costco.com/Service/FeaturePage.aspx?ProductNo=11023465
With that in mind, today I saw two articles about human intelligence, as it relates to voting. I suggest you read both, and pause after each paragraph to contemplate the word "doomed." It might make the experience funnier.
Here's the first. This one made me laugh my "ars" off.
This one is almost as funny.
http://www.salon.com/env/mind_reader/2008/09/22/voter_choice/index.html?site_design=grapenuts
Now go out there and vote. Especially if you are sure you are right!
(Doomed)
Yesterday I found myself in a political discussion that included my very lonely Republican friend. Eyes rolled when he claimed the Clinton administration was to blame for the mortgage fiasco. His argument is that during the Clinton era, lenders were pressured by the government, and by interest groups, to loosen loan standards in order to increase minority home ownership. This strategy reportedly worked splendidly while home prices were increasing. You know the rest of the story.
My Republican friend followed up with a link to an article that I have seen twice in the comments to this blog, so I hereby promote that link to my post:
http://www.nypost.com/seven/09242008/postopinion/opedcolumnists/house_of_cards_130479.htm?page=0
I'm not persuaded by the article, but neither do I discount it entirely. My problem, as always, is that I don't have enough knowledge to make a judgment about it. It sounds credible, but that doesn't mean much.
At best, the pressure to increase minority home ownership was only part of the problem. The executives in the mortgage industry must have known that the increased lending activity would make them even more stinkin' rich than usual, at least short term. In the long term, they would be living on their yachts. Without the greed angle, the executives might have better resisted what they knew was a risky path.
Second, as Warren Buffett said when he saw all the complicated financial derivatives based on mortgage activity, "My eyebrows are huge!" He didn't actually say that, but he did warn that trouble was brewing in the derivatives game long before it was obvious to people with normal sized eyebrows. So the exotic and complicated financial derivatives market made a bad situation worse, and that had nothing to do with the liberal agenda.
If there is any truth to the idea that the Clinton administration was a major cause of the mortgage crisis, you have to ask yourself why the media is mostly ignoring that angle. If it isn't true, does anyone have a link to a rebuttal?
Several people with knowledge of the media told me the survey "wasn't biased enough." Democrats and Republicans in the survey mostly stuck to the party line. Obama had the most support from economists, by far, but there are more Democratic economists in the country, and in the survey, also by far. To my knowledge, no one has ever studied why that is.
Today the headlines tell us that Obama is pulling ahead in the polls because likely voters have more confidence that he can handle the economic crisis compared to McCain.
http://www.msnbc.msn.com/id/26862018
In other words, public opinion is starting to line up with the opinion of economists. Did the Dilbert Survey of Economists have any impact on that move?
The biggest reason for the move in the polls probably has to do with McCain's support of Republican policies that are widely seen as the source of the problem.
Second, the financial problem is complicated. The only thing we ignorant voters know for sure is that we want someone with a high IQ to sort out this mess on our behalf. No matter how much you love McCain's philosophy, track record, moral compass, common sense, or anything else about him, he doesn't come close to Obama in pure brain power. For most issues, that probably doesn't make much difference. For an issue of this complexity, it might.
Third, I think the Dilbert Survey of Economists probably had some impact, at least with the free thinkers of the Internet. A lot of people, including me, assumed before the survey that most professional economists would lean Republican. The fact that so many economists are Democrats, and support Obama, is both a surprise and hard to ignore.
I wouldn't have funded the survey if I didn't have this blog. And I wouldn't have this blog if people didn't leave comments. So if the Dilbert Survey of Economists ends up changing the world, and you have ever left a comment here, you were part of something important.
