Reddit AMA - Postmortem

Well damn. That was a bigger response than I expected. I responded to several hundred people and I still have about 250 to go. Unfortunately I did it on the same day John Malkovich was doing his AMA. By the way, it was very good.

It also must be said that the vast majority of [people] in the world live with nothing and with the hope of nothing their entire lives. I was lucky, as I've been my entire life.

Well stated. I always wondered if some of the truly fortunate know this of the world. As a healthy white male who is well educated and born to a loving family in America I try to acknowledge my extreme luck whenever possible. Anyways, data:

According to Google Analytics I received about 34,000 page visits in the span of about 12 hours while Blogger tells me I got about 21,000. Not sure why the discrepancy (Kevin?). Regardless that's about 40% of the visits I have ever received up until that point.

I learned a lot about what people are interested in and concerned about as well as what information more or less everyone is ignorant of. It's very easy to succumb to curse of knowledge bias by thinking that others know the basics of what you think is common knowledge.

I've started to compile a list of the most common questions from the AMA. I hope to turn this into a visual graphic that shows what areas of sustainable design people are interested in. More to come.

Fosters Quantified

My wife and I were concerned that one of our foster kittens, Mustachio, wasn't gaining weight so we started weighting all three of them at regular intervals.

We have enough data points now that I figured I could get a fairly reliable slope of best fit, so I entered them into a Google spreadsheet and made a chart.



Mustachio seems to be doing just fine now, but it's interesting that his weight change is essentially the inverse of Tree Trunks (forgive me, I named them in about five seconds like an American Indian). Even though Tree Trunk isn't gaining weight as quickly as the others she's still gaining weight, so mild foster kitten worry allayed through some basic analytics.

Gasoline Prices, Cheap as Ever

I can't bear to hear people make statements that are demonstrably false.

"Gas prices are so high!"

No, they're low compared to the rest of the world and adjusted for inflation they're about the same as they've ever been in this country, so stop saying it. You're lying.

Source

Average is EUR 1.39 per liter.

1.39 x $1.30 (conversion to USD) x 3.78 (liters in a gallon) = $6.83 / gallon (premium grade)

The current average in the US is $3.85 / gallon of premium, so about half of what Germany pays ($7.76).

Same as it ever was. Source: NYT

Misleading Statistics

On my Facebook feed I found this from MoveOn.org:

This is a description of my thought process:

Wow, 1.38 million dead since 1968... but aren't there roughly 10,000 gun related homicides a year in the US? So about 450,000... where are the other 2/3's?

Wait, you're twice as likely to take your own life as to be the victim of a homicide. Are they counting suicides? I mean, I know a gun makes one more likely to succeed at suicide but surely they're not counting that.

Let's check their sources. What? I have to type that crap in... ugh.

But they're misrepresenting the numbers!

I know, I know, I'm typing.

Source 1
Source 2
Source 3
Source 4 < That's my favorite

They counted suicides. I get the logic, but this is a gray area and to be fair if you're going to count suicides in that number it needs to say so. It's misleading.

Oh, and I looked up the war deaths too. Suicide was not listed as a cause of death in any of the tables cited, but it very well may be counted. The chart does appear to take into account all deaths caused by war and not just those in battle. That's good. However, they don't count Confederate soldiers' deaths from the Civil War. Which is strange because more Americans were killed during that war than every other American war combined.

Kind of disappointed MoveOn.

Government Spending: Low and Falling

Just a quick note about an article by Paul Krugman that appeared on his blog today.

Krugman posits that the increase in government spending is mainly due to two factors.

1 - Since the economy has contracted, government spending is going to make up a larger percentage of GDP. Pretty straight forward.

2 - More people are unemployed and are thus collecting from various social safety nets: unemployment, medicaid, food stamps, etc.

The blue line is government (at all levels) spending as a percentage of GDP, so in the last 25 years it was fairly consistently was between 31%-34% of GDP. I'll also note it fell under Clinton and rose during W, although not by too much. Today it's 36%, actually not that high, relatively speaking. The red line is this same measure but as it relates to potential GDP. Basically, what our economy can and should produce. This number is about 34% which is much closer to the trend for the last 25 years.

Source: Paul Krugman's Blog: The Conscience of a Liberal

So there has been some increase in government (again, this is all levels of government, not just federal) spending, but a large portion of it is clearly due to our economy contracting (red line). If one considers #2 from above then it becomes clear that our government, sans safety net programs, has actually contracted in the last several years. This is extremely troubling. 

Politics and our general inability to come together as a nation and implement our hard won knowledge (see Great Depression) has prolonged this recession and harmed many lives in the process. This isn't "oh we just don't have quite as much money..." This is more young people committing suicide, high school students skipping college, older workers not being able to retire when they planned to (even when working class people's life expectancy has stagnated. Source: 1, 2), and increasing rates of depression that are no doubt related to the inability to find a decent paying job. Bad things happening are a fact of life, but watching them happen when they're largely preventable is tragic

If You Bemoan Federal Debt I Bemoan You

I am not an expert in economics. I have an undergraduate degree in it, but I'm not an expert. None the less the basic tenants of economics are being violated wholesale by our elected officials. This is part one of a basic overview of what is happening in the US right now. This is the simple stuff that if you don't understand you really shouldn't open your mouth about anything economics related. Sounds harsh? So are the consequences for saying stupid things. No one walks into a hospital and requests blood letting just as no one walks into congress and votes for reduced spending during a recession... oh wait.

What is disturbing is that our federal government is literally doing everything wrong that it can. I expect my friends and family who have never looked at an IS/LM curve or Keynesian multipliers to say ignorant things like "oh just let them default or whatever, we need to stop all this deficit spending," but for our government to act in a populist manner in this scenario is nothing short of insanity. It is wrong. It will hurt people. This is not an ethical debate. There are thousands of research papers, billions of data points, and hundreds of relevant historical examples to garner experience and guidance from. If you have a different opinion post the data because your slogan (big government is bad!) does not hold water.

Where to begin? Let's keep it basic. How much money does the US produce every year - or thought of as personal income - what is the US's salary? This is called GDP or GNP. Please read about it. It is important. Well the number is $14.1 trillion per year currently. That's 14,100 billions or 14.1 million millions.

How much is the federal government's revenue? That is, how much money does it collect in taxes? According to the CBO data (congressional budget office) it was about $2.2 trillion in 2010. That's $2,162 billion or 15% of all the money generated during a year in the US. Let's look at some data.

So how much is the deficit? It's there on the far right of 2010 above: $9 trillion. That's a lot of money and it's been growing, but why? Look at revenue on the far left in 1971 and then look at the next year and the next. See that? It goes up every year as the economy grows. Then look at 2001; it dips. Why? In 2001 and 2003 we had the Bush tax cuts. Revenue fell, nothing shocking here. After 2003 revenue continues to go up as usual until 2008 when Bush was still in office and our current mess started. Straight forward right? It usually is...

Aside: if our debt is $9 trillion and we produce over $14 trillion a year that's like the typical American who makes $32,000 (as of 2006) a year having a debt of $20,500 - sounds like a car loan (in 2006 the average cost of a car was $28,400 according the the government). Does having a car loan make you reckless, irresponsible, and broke?

Now let's look at how much the government is spending (outlays), that's the next column over. I made an Excel spreadsheet using the CBO data starting in 1990 because I'm lazy. You can see the formula I use and all the numbers. Look at the percentage change.

In the 90's federal government spending increases at about the rate of inflation. Then in 2000 spending ticks up and in 2002 it surges. Why? Well, wars are expensive. See how it's high in 1991 and 1992 when we blew up Iraq for the first time? Anyways, it jumps in 2008 and 2009 greatly because Obama is a socialist. Oh wait, no. The recession begins in Q2 2008 and lots of people are unemployed and now collect unemployment and depend on other social welfare programs. Which is what they are designed to do. That and there's the stimulus and bank bailouts in there. Then the stimulus mostly goes away in 2010 and outlays actually drops slightly.

So why is debt bad? Well, there is only so much money out there so whenever the government borrows it "crowds out" private investors and raises the cost of borrowing to some degree. Well, that does not matter right now because we are in a liquidity trap. What the hell is that? Basically, everyone is trying to pay down debt, save, and invest money. If everyone is saving then who is borrowing that saved money? When you put money in a bank or pay down a mortgage that money is lent back out again. If more people are saving than spending it makes it cheaper to borrow money because there's less demand for it. A liquidity trap is when common monetary policy (changing the federal funds rate) no longer has an effect. That is, lowering the interest rate does not spur more borrowing/growth. Well, the federal funds rate has been zero for a while.

So why else is debt bad? Because you have to pay interest on debt. What does the government pay in interest? They pay whatever investors are willing to lend them money at. That is, Treasury Bills. So what are the current rates?

Inflation adjusted rates - that is, the money investors receive after inflation, is currently negative on both 5 and 7 year treasury bills. At 10 years the government pays a "real" rate of 0.38% interest. This is not magic. There is almost nothing to invest in right now because there is so little demand and everything is so uncertain, and up until recently it was unthinkable that the US Federal Government would default on its debt. Hence, we are the safest debtors in the world and get the lowest interest rates. Let's see some data...

Look at the second to last column. Every year we pay more and more in interest until 2009. Then it drops and stays pretty low. Why? Because the federal government can pay almost nothing to acquire long term debt as explained above. Hell, people will pay them to acquire short and medium term debt (up to 7 years!).

Do we need to do something about the debt? Absolutely, but not in a depressed and now stagnant economy. So why do we need to reduce the deficit in a depressed economy? We don't. Borrowing is cheap. If I told you that you could take out a 10-year loan for 0.38% above inflation, try to make money with it, and then pay it back do you think you could? If your answer is no then keep your 9 to 5, otherwise welcome to America. Let's borrow more money so investors have something to do with all their cash that's sitting on the sidelines or in gold bars doing nothing. Let's build some bridges, fix some national parks, upgrade our research facilities, double NASA's funding, fix our schools, invest in cleaner energy, help the poor, and provide basic healthcare to all. It's an investment in our basic infrastructure and I bet the returns will be more than 0.38% over inflation.

Reading Material

A new study shows that people with schizophrenia aren't fooled by the concave face - lite from the bottom optical illusion that the rest of us are. The video is interesting as hell. I couldn't not watch it. Total side note: at the end of the article it's mention that drunk and high people are often not fooled by the illusion much like people suffering from schizophrenia. Perhaps this explains why when watching a movie in one of these states I often can't buy into whatever the actors and scenery are trying to convince me of. Interesting.

Google talks with newspapers. Not exactly a riveting read, but a bit funny.

Food myths. One of those guys, Brian Wansink, I've been planning to write about forever and just haven't. His research is truly fascinating.

Just found this data website called data360.org... yikes. It's a collaborative open-source place to upload your data for others to see. Getting excited by such things... man. Their about us page is a good read too. Here's an excerpt:

"I continue to believe that responsible citizens must strive for objectivity when thinking about issues. To not strive for objectivity is to leave the realm of facts and enter the realm of dogma, doctrine proclaimed as true without proof. I believe that a current reality does exist and that from that situation, we are both confronted by real problems and that we are making real progress. Knowing specifically where there are problems and where there is progress is one crucial objective"

Word.