Do Not Automate College Yet...

Seen a few articles on how it would be better to push more people through college by automating classes and putting more classes on the web.  This is my counter argument.

The following is an assignment:
Gather the Head Count Ratio (percentage of the population who fall below the poverty line at $2/day), the population, and the poverty line ($2/day).  Use a spreadsheet to calculate the total headcount of the population falling below the poverty line, remembering that the Head Count Ratio is the Head Count divided by the Population.  Turn in a spreadsheet table that says if the Head Count has increased or decreased in your country over time and graph it.

Let me give you an example of a student let's call "Bob."  Bob gathered that in China in 2002, the Headcount Ratio is 51.2%, and the population is 1.28 billion.  Bob then calculates the head count, the total amount of the population of China who fall below $2 a day, as 65.5 billion people.  Bob turns this in. 

When I give Bob a "D" (which means 'incomprehensible work, showing minimal understanding' in my class) he comes into my office demanding to know why.  I point him toward my comments on his grade evaluation: "Check your spreadsheet formula.  Are there 65 billion people in China?"  Bob still does not understand.  I ask Bob what 20% of 100 is.  Bob responds, "20".  And how do we get that? "I don't get where this is going?  There aren't 100 people in China!" (*actual quote*)  Some one does not appear to have the faculties for abstract thought. 

I sigh with depression, and ask him if the planet has 65 billion people on it.  He does not know how to respond.  I ask him that if we want 51% of x, how do we get that? 

This goes on for ten minutes.  Ten... painful... minutes. 

Now, I have 27 students in my class.  Only 33.3% (approximately) managed to successfully apply the lessons in percentages they should have known since 7th grade.  I'm not even going to mention the idiots who multiplied the headcount ratio by the poverty line, especially when we spent an entire lecture just explaining what each of these measures are. 

When I see a majority of my class doing the work that I could not legitimately train a monkey to do, then I will support automating university.  Until then, they apparently need college to make up for their absolutely dismal middle school education. 

Foundation and Facism.

Sat down this Thanksgiving break and did what I'd been thinking of doing for a while: read the entire original Foundation trilogy. Was easier than I thought, and the writing was enjoyable. I wanted to do this due to some relatively recent endorsements in the speeches and articles by Paul Krugman and how it relates to economics. So I sat down to read the novels with an economist's approach and came away confused, disappointed, and a little shocked. In no way do I mean to disparage the writing of Asimov, I get that it really is just a sci-fi version of "The Decline and Fall of the Roman Empire", but I would have thought he'd use a bit more forward thinking for his future galaxy.

Problem 1: The Galactic Empire. Unless I missed it, there is no real semblance of democracy. Asimov's gigantic Empire is best described as either a Facist or Oligarchic society. The emperor has total control over the life and death of his people. Then the great danger is the fall of a totalitarian government that oppresses billions and billions of people for the purpose of propping up a planet that Asimov describes as being totally devoted to the bureaucracy of a ruling political class? And the entire mathematical study of pyscho history is invented to replace this empire after its fallen? Not improve it? Not ensure that no one else is ever disappeared again or murdered on the whims of the politically powerful? Hari Seldon wants to return and recreate the all powerful totalitarian state? Again, I get that this is Rome in space, but the future of Earth after the Romans fell on average has been a big win. The fall of a comparable empire (the British) was followed by the largest increase in per capita income, health, and educational outcomes that history has ever seen. Wouldn't the idea be to avoid a second galactic empire for a better system? Or is the point that we can do no better? I am honestly in the dark here, if some one with a better understanding of the novel can help me out.

Problem 2: Totalitarianism through mind control. The Second Foundation, which is apparently the new governing body leading to this second empire controls events through emotional and mental manipulation. They are hidden in some kind of academic society, and commit themselves apparently to this rebirth of the old totalitarian state for the sake of stability. This is a good thing? An oligarchy with mind control? And all their motivations and desires are purely for the good of humanity and the completion of this Seldon plan for a second empire? They have no problem manipulating the villain (the one who is supposed to be the bad guy) into wiping out an entire planet just to stay hidden, and then leave some of their own to a lynch mob to convince everyone else they do not exist anymore. And why? Because knowledge of their existence throws some wrench into the plan? What the hell? These guys make Alan Moore's Ozymandias look like a rank amateur, because all he did was murder everyone living in New York City to avoid the nuclear war that he thought was coming (and I'm beginning to wonder if that outcome was as certain in Alan Moore's "Watchmen"). But even Moore gave you an idea of the sickness of this. He introduced you to the characters of the news paper stand owner, the boy reading the comics, the psychiatrist who tried so hard to save people one at a time (at the time of Ozymandias' massacre, he was trying to stop a street fight). He made the reader connect to them just before the "Grand Plan of Salvation" was put into place in all its terror. Asimov makes no attempt to introduce the people who are being slaughtered on a chapter by chapter basis all in the name of some vague greater good of re-founding a totalitarian state.

Unless this is actually Asimov's point and I've some how really missed the mark, the Foundation comes out more the villain as it subjugates and conquers the surrounding planetary system, leaving them open to rule by yet another distant and centralized government which does not truly represent them but rather rules them. And all for the sake of stability? The idea of survival of mankind? I'm lost, I admit it. Is the point that the Foundation is good or bad? Or is it just as it is? And was 30,000 years of instability with multiple self-ruled planets really not preferable to 1000 years of rule by a minority, chosen based only on their ability to perform abstract mathematical equations in an academic setting?

There are some economics arguments... but these two are the most unsettling for me. What confuses me more is how most people I talk to refer to Heinlein as a facist for his "Starship Troopers" novel based on a society that requires military service before citizens can vote (and not based on Nazi Germany, but on good ol' Switzerland) . But is anyone criticizing Asimov for portraying as progressive a totalitarian state run by manipulative and authoritarian academics as being facist? "Benevolent" dictatorship is still dictatorship. Power corrupts, and absolute power corrupts absolutely.

As a note: not saying the Heinlein arguments are wrong, but if we're going to talk totalitarianism, the guy who wrote "The Moon is a Harsh Mistress" seems to have a one up on the guy who wrote Foundation. Just saying.

Unnecessary Conversation.

Student: Hi, I'd like to discuss my grade.

Me: Okay. Which part?

Student: Well the presentation?

Me: The one you e-mailed me about ten minutes before class to say you would not be giving it*.

Student: Yes.

Me: Any reason?

Student: It just wasn't coming together.

Me: I assigned the presentation the second week of class. Other students have been in my office hours for the past two weeks preparing. Where have you been?

Student: Around.

Me: Well, you've failed.

Student: And how much is the Presentation worth?

Me: Well, the presentation is 40%, the Portfolio is 50%, and the homework is 10%. There is 5% extra credit if you complete a few other assignments. You have not turned in your last five chapter summaries at all though**.

Student: So... I should drop?

Me: Last day to drop is this Wednesday. After that you would have to seek a retroactive withdrawal from the college, so I really don't enter into that decision.

Student: So... I should drop?

Me: I'm not supposed to say one way or the other, but I would suggest you do the arithmetic on your current and potential grade and decide for yourself***.

And then there were 3. That's seven minutes of my life I will never get back.

*It is clearly stated in the syllabus that students must give 24 hours notice if they will not be giving their presentation and have a legitimate excuse with documentation (jury duty, medical emergency, etc.).

** The portfolio is a semester long project where students write a chapter summary applying the theories and concepts in the textbook to current events in their given country. They are two pages in length double spaced; they are not hard.

*** All of these numbers are easily available on Blackboard.

What Does She Have to Do?

To convince everyone that she is completely incompetent? Better yet, that she is bottom-line a horrible human being.

Congresswoman Bachmann is not insinuating, nor hinting, she is out-right saying that Hurricane Irene and the East Coast quake are punishments and messages from God that the US government should cut spending.

Wait... what?

That's right, Timmy, your puppy drowned last weekend in the Hurricane, not because daddy forgot to bring him in, but because God wanted to let our government know that he is concerned about the debt to GDP ratio. Because God is pretty big on the performance of economic aggregates. There's a whole chapter on it in Second Opinions. It's right next to the passage that warns of secular Kenyan Islamists.

Just to take a bit further: God killed 25 people (so far) because government spending is just way out of proportion to the Biblical mandates. Don't tell me I'm being silly, that is exactly what she is saying. Should we rewind?

"I don’t know how much God has to do to get the attention of politicians... We’ve had an earthquake; we’ve had a hurricane. He said, 'Are you going to start listening to me here?' Listen to the American people because the American people are roaring right now. They know government is on a morbid obesity diet and we've got to rein in the spending."

This is also assuming that the will of the American people as she is interpreting it, is equal to the will of God. You know what else was the "will of the American people" in the South back in the 50s and 60s? The will of good, Godly, church-going, voting white people? Even the Mormons now reject that God is racist, so maybe the typical voter is not a good gauge of what the creator of the universe is intending. Maybe we should go further back to slavery, because that was Biblical and supported very heavily by certain state governments.

And you know what, let's just stop a second here, because her idea of government in Christianity is a bit skewed.
1) There is no democracy in the Bible, not as a government form, and certainly not implemented by God. In fact monarchy seemed to be the favorite, with David being the benevolent dictator "after God's own heart" (1 Samuel 13:14). Not exactly the contemporary Republican view of "small government."
2) okay before you hit "comment" and school me on Acts, yeah I know: Acts 2:42-47. Everybody gets together, shares their stuff, eats, drinks, and is merry. That's hardly a government. It's a fellowship, its a church. Not a government. But if we want to go that way, then everyone piles on their wealth into a big pot and shares it. This is closer to facism or socialism than to good old modern day American "capitalism". Read a few chapters later, and we find that the punishment paid for not sharing with the other children was death.

These are not the acts of a an "invisible hand" kind of God. In fact the self-interested actions of individuals in that case led to death, and not the overall beneficial societal outcome (the butcher and the baker better not set the wrong price, or they will die). So what makes the Congresswoman believe that God's message (if it is indeed that) is a message for smaller government? For people holding back more? Perhaps God wants more government spending! Over 9% unemployment, people losing money, people losing job-attached insurance, the suffering of God's children, while the wealthiest control a huge amount of our macroeconomic spending power. Does this sound similar to what you're reading in Acts 2? Wouldn't a redistributive and powerful government be more Biblical? God did after all appoint kings; something that Americans across this hemisphere spent many years, many lives, and many wars trying to throw out. Maybe God wants us to return to a monarchy?

But she also should probably stop cutting her hair so short, and in fact cover it up if she really wants to get Biblical. (1 Corinthians 11: 3-9)

Or maybe a hurricane is just a tragedy, and an earthquake is just a disaster. Maybe all the good, upright, and charitable parts of us come out during these tragedies and the faithful, spurred on by their belief in a loving deity, run to meet the needs of the suffering (as they did and have done many times). Maybe God's message is to help and love one another with our short time on this world to the best of our abilities when disaster strikes.

The point here is that Congresswomann Bachmann is a hateful, vile, stupid, selfish, dung heap of human wreckage. How dare she use the deaths of 25 people for political fodder, how dare she spread her warped messages, and how dare the people of Iowa honestly support this slug of a human. Shame on her, shame on the state of Minnesota for electing her, and shame on anyone who supports her.

UPDATE: The report is that she said this as "a joke". So which is worse: that she would seriously believe that 25 deaths were a message from God about government spending, or that she would use these people's deaths as a joke?

I am willing to bet the Congresswoman was not joking. The "joke" aspect doesn't change a thing: this is not something that should have been said in any context.

Bravo.

It used to bother me when I heard blowhards making (at best) careless and incorrect statements about women not being as good as men at science or mathematics. It bothered me more when I heard young women in my class discuss how they were not good at economics or math based on the gender they happened to be.

After I found out I had my own little girl about to make her stunning debut sometime around the end of October, then these things just started pissing me off.

So my little owl, here's the best news story I've read all month.

Also a bit of hope that there is something going right with education in the US.

Blagobamavich is Watching.

The IMF and World Bank seats are up for swap (no givesies-backsies!), and bit by bit our federal government is chipping away at the fourth amendment.

But thank God our corn subsidies were saved. WHEW!

Olly Olly Oxen Free, Evo Morales.

Well its official: grand theft auto is now legal in Bolivia (so long as its stolen from somewhere else).

Question though. The smuggled vehicles are sold on the cheap in the black market because they are illegal and the sellers need to avoid certain laws and enforcement officials. If a seller can now instead "legalize" the stolen car once it is in Bolivia, can't he raise the price now, pay any marginal tax, and avoid the risky cost of being caught and put in jail by Bolivian authorities? Would the legalization not raise the price of cars for the poor, hurting the very people Evito says "have a right" to own them?

And for you car smugglers, hear me out: you no longer have to fear consequences from the local police, so long as you stole your car in another country. The poor you've been selling to have had the implicit threat of ratting you out (or possibly being a police informant). Seriously, raise the price of your merchandise. Evito has done the cost minimization for you.

How would you deal with that situation though? "Officer, I swear, this car was stolen in Chile." How do you prove something like that? VIN number and maybe papers in the glove box?

Update: Follow up question, since Evito is okay with larceny do the Bolivian people expect to have much a treasury left when he leaves office? Some one might want to double check the books.

Rational Thought Update: The italics section actually is wrong. Evito has a point, and I'm backwards. Let's go back to ECON 101. If there are 100,000 "new" cars on the legal secondary market, that pushes out the supply curve, putting a downward pressure on price. So prices in the legal secondary market do indeed GO DOWN, benefiting consumers. Here I think is my confusion: would the price of the legal secondary market be higher or lower than the illegal secondary market initially? I'm assuming it was lower since there were 70 to 100 thousand cars that magically appeared for registration. The legal secondary market price could be pushed lower than the illegal one, and that would be a benefit. If it isn't, than consumers would continue to participate in the illegal one, as the price is relatively lower.

Hm...

Same as the Old Boss.

I've never been this bored before.

OMGLOL, it's a lady! That'll help the IMF's rape-ish reputation (assuming that the IMF operates under the Polanski definition of "consensual"). There is no way that she's involved in any kind of shenanigans that could embarass the IMF cause she's got the whole lady thing down! Plus she's French, so they'll be getting a second chance... or... seventh... but who's counting?

Simon Johnson has had some interesting (and more mature) pieces and interviews published here, here, and here (this last link being a much better explanation of the IMF than I provided before).

IMF-related boredom/face-palming:
Eliot Spitzer says something stupid. He uses Chinese consumption of electricity to make conclusions about the growth of China's economy, and how it will apparently soon surpass the US. He cites an IMF report of the Chinese economy surpassing the US in 2016. Oh for Confucius' sake...

I have not seen this IMF report (he fails to cite or link it), but I'm going to bet its one of the usual GDP measures. Now I'm going to tell you all something that every single student I've had knows that Eliot Spitzer apparently does not:

GROWTH

IS

GOOD

!

See if you can keep up Eliot. First of all, the proper measurement for making these kinds of ridiculous judgements is not consumption of electricity at the country level, which while a nice instrument, is not informative enough. You see, Ellie, economists have been using Gross Domestic Product since Buddha-knows-when to approximate the "size" of the economy. Picture a big woman with a big purse... wait... no, let's not do that so you don't try to pay her for... moving on. Let's just picture a big man with a big wallet. The GDP is the size of this man's wallet; we assume he "spends all he receives" in income, so his total expenditure is his total income (his wallet). Still with me, lab partner?

Our big man is not a good approximation of welfare or economic ability of the citizens, just potential economic power, if some one liquidated the entire economy and put it into currency. It could be that one Chinese dudette holds the entire GDP in her hands, while the rest of them starve. But let's put inequality on hold. Let's just think about population.

A more proper measure of economic size is to look at the "spending power" of some representative (average) individual in that economy. Divide GDP by population. The number has changed! In fact the rankings have changed! Let me give you an idea, the GDP per capita of the United States in 2010 was $45,989 (FGI, Eliot). The GDP per capita of China was $3,744.

Let me make it more simple:
$45,989 > $3,744

That means that forty-frikkin-five thousand dollars per person is strictly greater than three thousand seven hundred per person. So, Eliot, retake economics. Or just listen to John Oliver, a comedian who seems to have a better grasp on things than you do:

"Any nations economic strength is solely in the hands of its citizens' ability to consume... That is why America is the greatest economy on Earth! You people can't be beaten! ... I was in a mall in Connecticut and a saw an item in a shop window that stopped me dead in my tracks. ... It was an inflatable bar-be-que! ... It was a full functioning bar-be-que so that you... could cook while swimming! Is there any greater example of what it is to live in the freest nation on Earth than that?! ... Will China emerge as an economic force and take over the planet? Could China make an inflatable bbq? Yeah? ... Could China sell an inflatable bbq? Could the people of China for themselves purchase inflatable bbqs? There is no f***ing way!" ... If you are still unconvinced allow me to introduce you to exhibit B, the Oreo pizza!"

You may be equal parts horrified and amused by this (and there are a few comments I'm leaving out), it is true. That is the point of Development Economics; that there exists this gaping inequality around the world. China is still a developing nation, and the amount of poverty, oppression, and misery in that country is still unthinkably high, no matter how much electricity is being used.

And lastly, Mr. Spitzer, growth of income, growth of GDP is not a contest. While pundits like you are playing economic whip-it-out contests on cable news networks to the delight of "journalists" and news junkies who spend and make millions of dollars on this kind of crap, villages in China are going without adequate sanitation, medical care, food provision, and utility provision. Have you no shame? Have you no decency? The increase in per capita GDP of any country should be celebrated as those who were poorer are now relatively richer! That electricity consumption increase could be the purchase and use of washing machines, freeing up time for mothers to teach and care for their children. Yet you treat it as a threat to American companies? AMERICAN COMPANIES!?!?!?

To all of you self-serving, incompetent, and insecure politicians and pundits, I propose you shut up about this ridiculous "China surpassing America" conspiracy BS. What you are saying, in fact, is that we as a nation should do our best to keep other countries poor, so that we are still "#1". The point, as horrible as it may sound to those who decry materialism and decadent spending, is so that the Chinese CAN buy inflatable bar-be-ques, if they so decide.

That is why we measure income growth, not some childish ranking.

They Lie to Your Face.

Out of the mercy of my naive heart, instead of completely flunking two students who obviously collaborated on the take-home exam (even when they had the option of working in a group, so long as they told me who they worked with and followed a group-evaluation grading scheme) I simply assigned zero credit to that question. The other two question answers were quite different and therefore they received what little credit was due to them on the few parts they got right. Not a 0%, but still two Fs.

And yet, less than thirty minutes ago here they are in my office in tears, accusing me of being unfair. They demanded proof that they had collaborated. When I showed them the equations (which were identical in errors and form) and the sentences which were nearly identical (God bless SafeAssign) their excuse was, "Well that's what comes up in a Google search!" I told them that I will regrade if they bring me proof of the source.

When/if they bring the source into me, I'm going to flunk them for not following directions on correct citation, and inform them that if they want to appeal to the Department for a grade change that I will then charge the two of them with Academic Misconduct and plagiarism.

One of these particular students was in my office before, in tears, begging to get to the exam early because she was going to be out of town this week (the week after Spring Break), and whining about how she had to spend her Spring Break at home. I gave her the data set early, she had 3 more days than all other students were given. I also overlooked that she turned the exam in 12 hours late from the due date we both agreed on. Now, not 30 minutes ago, she came into my office she then accused me of being the one forcing her to stay home from Spring Break. This is how a responsible adult behaves.

Out of 20 other students who took the exam, not a single one of them procured identical equations, with identical subscripts, and identical errors. And they all cited their resources correctly.

The particularly angry-Spring-Breaker had the look of "I'm going to talk to some one!" in her eyes. Bring it on. I'm especially happy to deal with students who lie to my face.

My New Windmill: the KS Legislature.

Oh, Kansas State Legislature. How I love thee... let me count the ways. Way #5,543: Connie O'Brien's subtle racism.

But when composing my letter to this particular representative I decided to stay away from the racism aspect and just focus on her idiocy. I try to be nice in the letter (a little); there are after all some thought-out and legitimate arguments for not giving in-state tuition to the children of illegal immigrants who have completed a high school education in the state of Kansas. I just think that the benefits outweigh the costs. I can provide a moral argument if you want, but as an economist I have no morals (ba-dum-bum-TSH!).

Still, I would prefer those arguments to some angry grandma b****ing about bureaucracy, because if we choose our politicians by how much they whine about unfairness then I honestly should be a governor by now. My wife can confirm that I whine with the best of them. No. We expect more from representatives even if we disagree with them. Using this kind of argument in a legislative committee is immature, incompetent (that's the word of the day), and a waste of time. The people deserve better.

And yeah, what she said was racist. But I feel that's being covered quite well in the press. I want to focus on how dumb she is. In the most professional way I can muster (I might go a bit far in places...).

Enjoy my letter to her office.

"Representative O'Brien:

After having read and listened to your testimony of 2/08/2011 I felt a strong urge to write and share my disapproval of your statements. In the interest of full disclosure, I do not reside in Tonganoxie, so I am not represented by you, I am not affiliated with either party, and I do disagree with you on this bill.

You testified in front of a State Committee regarding a very contentious and complex issue using an anecdote about your personal experience. You did not know the woman, you did not know her situation, and I do not believe that you can tell her status by the complexion of her skin. That is for the office at Kansas City Community College to decide with the proper paperwork, not some one who is frustrated at her financial situation or having to wait in line. You presented no statistics, no research, nor any other verifiable anecdotes to support your conclusion. Furthermore there is no way to prove that this situation occurred as you stated, except on the strength of your word. To be frank, as a politician, you already have one strike against you in terms of my personal trust. Your testimony in other words was useless at best, and completely incompetent at worst. I would understand your statements (though still disapprove) in the context of talking with friends and families, but not as official testimony regarding legislation that will affect many other people's lives, incomes, and aspirations.

I do not agree with your position on this bill, but I am open to hearing legitimate arguments that include more than a hissy fit about a problem you had in line (you do not even know if this woman got a scholarship or not). You have brought embarrassment to your county, to the state, to the party you represent and their possibly legitimate arguments in this debate, and to yourself for your absolute incompetence and lack of professionalism. Take a day or two to do the research before you default to gossip and speculation.

The people of Tonganoxie deserve better, and I challenge you to step-up and bring real arguments to any official hearings, not "woe-is-me" speeches about how unfair life is for you or your children."

If you feel strongly one way or the other about this issue and wish to contact Representative O'Brien, here is her office information.

Selective Class Size.

It did not take me long to learn how to loathe large classes in my first year as a GTA. "The more the merrier" naivette regarding letting students into a discussion group would lead to 32 or 34 students per class. Doesn't sound like much until you have three of them (that makes for at least 96 students o grade for). "The more the merrier" gave way to "the less the better."

When I got my own class, "the more the merrier" returned, with a whopping 40 students in my Latin American Development class. Big mistake. The 17 student intro to econ course the previous summer was such a dream, followed by a nightmare of poorly written exams, and essay assignments that made me want to melt my own eyes with my soldering iron.

I quickly began to look into ways to "select out" the problem students through a fun little signaling game I call "Scaring the Snot Out of Them on the First Day."

Students with low attendance scores have lower exam scores and tend to be pains in my rear-end around the end of the semester when they finally do start showing up? Well hello draconian Attendance policy. The two minutes it takes to run through a list of names is well worth the two or three students that immediately dropped the first semester I implemented this. From 30 to 28 in just one move... game on.

Student papers are riddled with poor citation and downright plagiarism? Announce to them my refusal to believe in "the myth of unintentional plagiarism" and promise that I will spend my free time trying to get them kicked out of school if they so much as paraphrase without proper citation. More drops. Why? Don't believe the lie; students know when and how they plagiarize. The two or three per class who will actually try might think twice about even sitting-in.

Group presentations is another good way to push a few out, but make it even better by allowing for "peer evaluation" to determine individual grades. Then show an example of how a group of students screwed over one of the slackers (justice is never pretty). The new thing is a portfolio that they have to work on all semester with chapter summaries and data projects.

The total number of drops for first two days: 9. Three added but have not shown up yet. Count is steady at 24 students. A good round number.

I might change strategy at a small school, but for right now, in a big public university I'm going to keep with my size strategies.

UPDATE 2/6/2011: As of today, my class size has gone down to 22 from 30. Some of these 22 are adds, but the total drop number is a record for me: 15 drops in the first two weeks.

Goldman Sachs Has Your Personal Information.

Let me start off by saying that I have a lot of respect for the research that goes on in Goldman Sachs, their seeming immortality in the face of recession and prosecution, and their knack for making money out of nothing. Bravo, GS.

The recent news that GS is going to invest heavily in Facebook though should make everyone feel a lot less comfortable with their social networks. I recall years ago discussing with some economics and psychology students the treasure trove of data that Facebook holds. It would be, as one of my former economics professors called it, "some really sexy data." Having a large amount of data on a significant proportion of high income consumers (if you have the internet and live in the US, I am considering you a "high income consumer") for their social contacts/links and web activity would be worth b-b-b-b-billions to any good market research firm with an army of researchers. Which GS has.

So GS is going to float Facebook for a while, so they don't have to reveal some of their internal shenanigans, and do you honestly think access to your data in some way or other is not part of the deal? I only regret not getting off Facebook sooner; they keep your data for a few months to ensure you "really meant to quit." And do you think Zuckerberg is really going to deny them your data when he let's Farmville take it?

So again, bravo to Goldman Sachs and Facebook for their astounding feat. Facebook created a way to convince people to give up mountains of valuable data in return for no monetary value (I will agree there is a value to 'connection'), and has made billions by selling it to firm, who will in turn get at least billions in research data.

Again, if you feel that access to a social network is worth the web activity data that you give up, then by all means sign up for Facebook and just understand that GS and Zuckerberg and making a lot of money off of it. Personally, I'm not getting back on Facebook until:

a) I get a check from Facebook for signing up and posting my data online for their availability, along with access to their network. I haven't decided on exact prices for each service. My individual data is cheap, so off the top of my head I'm thinking $100 per year.

b) I have a small business which would get serious value from the available advertising and connections in the social network.

c) since Facebook is now into tracking the sites its users visit, I think they should pay by the hour for any sites I browse while using their services.

For those of you who think I'm paranoid or being stupid regarding all the great things they get from Facebook (and I don't deny its a good service), just remember that its not a fun little network of people connecting. It is a corporation, providing a service for a price. The price is the data you put up, which they re-invest to make more profit. I just think my personal information is more valuable then the ability to be stalked.

Off the Grid

I have been thinking over the past month about quitting Facebook. So I sat down and did some basic economics. The opportunity cost is the value of what is given up to get something (basically). So I estimated my time on Facebook in a given week, and set the value of those hours to minimum wage (what I might be earning if I spent that time doing some low wage job instead). That should give me a lowish approximation to the value of time given up not doing something else (baking bread, watching TV with the esposa, working on research, working on teaching, etc.).

The time on Facebook was negligible to amount of time in the week doing other activities. So the total value came out to around $40 to $50 (at a minimum wage of 7, five to six hours on Facebook would cost something like $35 to $42).

I have as yet received no income value from Facebook in terms of connections made, jobs found, or other social network services. In fact the most utility I receive from Facebook is browsing my old friends' profiles, and making what I consider to be extremely clever comments on their walls. I'm not sure, but I think I would pay around $10 a month for that kind of service. So already, the costs are outweighing benefits without getting into the issue of information.

Then I began wondering how much value I generated for Facebook, and began looking at the ads on the side of the screen. These numbers get pretty staggering even if you lowball them, and that's why the founders are all very rich young men. Fair enough, a company has to make a profit. But the value they generate from my logging in far outweighs the benefits I'm getting, as I have valued it. Do I lose anything from that? No. They gain, I don't lose. Still fairish. I'm not being specific on the numbers, because honestly I'm assuming a lot. Here's what I did:
I assumed that Facebook earned about $1 per ad that was displayed on my profile. I averaged about two to three ads on my profile each time I logged in. I counted how many times a day I logged in, and figure that was the per day value they get (so five times is $5). Then multiply that over a week, a month, a year. Maybe my estimate is too high, and maybe its not done that way. I really don't know, but this is the system I set up. If anyone wants to correct me, I'd love to sit down and crunch the numbers properly. But right now I'm too lazy to search it... apparently not lazy enough to not write a blog about it though. Go figure.

Then I started thinking about the value of my information available out there. My name, my birthday, my hometown, my list of friends, their list of friends, the communications between us, the search-able photos available of me. A few days ago I decided to try an expected utility exercise, and assumed that there was a 5% chance my identity gets stolen on Facebook: that is enough information to get into my bank account for at least 48 hours.
Now the monetary value of my bank account is very little in absolute terms, but failure to pay rent, bills, student loans, all affect my credit score and future ability to attain a loan. Furthermore getting put out on the street would incur other losses. Granted, there is a small probability of disaster in this case (5%), but for me the expected utility becomes a rather large negative number. Maybe I'm just reading too much into Nassim Taleb's Black Swan, but the interconnectedness and volatility of my life suddenly became very worrying.

I get that the Black Swan Facebook sounds crazy, but it is one of many examples I considered. There were a number of distinct, large, and probable expected losses associated with being on Facebook, and very few distinct, large expected gains (in fact no positive Black Swans that I could think of). I do not own a company that needs to find consumers, I do not get any value professionally from their social network, so its all a boost in my own personal utility. But I'm paying a repeated cost of lost time and continued, unjustifiable exposure to possible low probability disasters. I do remain on LinkedIn as I see some possible future benefit to business connections. But I can't economically justify Facebook.

That or I'm sick of all the random messages I'm getting from people I hardly knew from high school suddenly wondering how I'm doing, what's up, and if I'm going to the reunion. How many times before next year am I going to have to have that conversation? (I would pay $50 to get out of those conversations, so I apparently value it at -$50. Another blow to Facebook.)
That and the advertisements. I freakin hate the ads.

No, He's a Keynsian.

In the middle of my masterful lecture on inequality and credit markets, a lecture I had prepared for with gusto, a lecture I was delivering at full steam, driving home the economic models and theories which lead to the failure of credit markets in highly unequal societies, a young, usually very bright student raised their hand. "YES?" I said with a flourish, "A QUESTION?" anticipating the nugget of wisdom that will come from the fertile mindsoil of their upper level undergraduate minds. Perhaps was he going to ask about failed redistribution policies? Question a piece of the model where a different conclusion could be reached? Point out the controversial implication that rising wages would stifle entrepreneurship in developing countries (see Development Economics by Debraj Ray, chapter 7)? Not agree with the implication that inequality is not Pareto Efficient and begets more inequality?

"Yeah, is Paul Krugman a socialist? I mean... he was on the Colbert Report last night, and he sounded kinda socialist."

I'm not sure if I physically manifested the deflation of my ego upon realizing that my students had wandered off into reruns on Comedy Central while I was presenting what I considered at the time to be one of my more fun lectures.

Back to the drawing board...

The Importance of Work.

The graph above (many thanks to one of my Indonesian colleagues who made it look prettier) shows my current Junior/Senior level "Economic Development of Latin America" students' exam performance (x-axis), with their homework performance (y-axis).

Homework "is entirely voluntary, 10% extra credit, and designed as exam preparation." The homework is basically a voluntary curve. I refuse to arbitrarily curve their work.

I am aware that an excel graph is in no way a rigorous statistical analysis, and I cannot really draw any causality from this (correlation maybe) without some serious econometric mumbo-jumbo. But I do have two words for you:
Selection bias.

Enjoy the pretty colors and dots.

Geography is a Problem.

Dear Students,

When I ask you, in a class called "Economic Development of Latin America" to "give an example of such and such economic policy in Latin America" on a homework that you have had a week to work on, I do not expect you to write on the following countries:
1) South Africa.
2) China.
3) Estonia.

When, in a state of disbelief and shock, I quiz you by asking, "What continent is Nicaragua in?" the correct answer (answered by ALL the US students except one) is most certainly not "Central America".

When, in a further state of disbelief and shock, I ask you to name at least 3 Caribean countries, one of the possible correct answers is NOT "Argentina."

So dear students, congratulations. You have just successfully added a geography component to your second exam in October.

I really should have emphasized the maps more at the beginning of the semester.

Wifey Come Home

I have just posted four blogs since my wife left to visit her family in Mexico and see her sister graduate (FELICIDADES!!!!!!! :) )

Seriously, amor... come home before your husband goes mas loco than he already is (don't think I've ever looked forward to a Monday this much).

I am in no way...

... actually represented on this graph. Interesting to poke all my friends with this though... but then again they actually have jobs... but whatever. I can lie with statistics just as easily as the next guy.

Just a note though: my three undergrad degrees are in Economics, Spanish, and Mathematics. So should I average out the salaries (weighted perhaps by my GPA in all?), add them all together cumulatively, or maybe find a more complex index?

Zombies > Vampires.

Aside from my disdain of vampires, most of you probably already know my very dire warnings of the zombie apocalypse. The good people of the University of Ottawa Mathematics and Medical Departments, as well as Carleton University, have put forth a convincing and rigorous mathematical model on how to avoid the Zombie Apocalypse when it comes.

Everybody grab an axe, a shotgun, and get ready for a "long, hard slog."

Interestingly enough, according to my brief statistical survey, math departments treat zombie apocalypses fairly credulously while usually completely debunking the possibility of vampires. Either that or vampires are just LAME!

Added note: any academic paper that cites Simon Pegg is Freaking Awesome.

Odds and Ends at 1:45 AM

Let me share with you a poem written on the back of an Introductory Economics quiz for my colleague and friend Sasha, from the Undergraduates:

"Sasha- I missed you very much today :(
you better be here on final day!
Your smile shines so bright,
You are the light that we all like!
Love the Chi Omega girls."

My Ukrainian friend has apparently garnered the attention of several Chi O girls who write notes for him during quizzes. The TA's like to read them to him during breaks. Especially in little girl voices. Congrats my Ukrainian friend, you have the attention of one of the most powerful sororities on campus. Since he was sick today I posted the poem found on the back of the quiz to his office door... then told all the faculty I could about it. There was a line outside his office by 3 PM to read the note. Awesome.

Speaking of awesome the US Senate actually stalled the bailout bill for car companies.
Look, let me break it down for you. Forget the history the US has with auto makers GM and Ford. Forget this myth about our past generations supposedly being smarter and more heroic than we are, and therefore we should preserve their lifestyle completely. Think about what would have happened if the US government had killed Apple and Microsoft in the 1980's to protect IBM.

Let Creative Destruction happen. Keep the 25 billion for alternative fuel sources (despite how much I loathe ethanol). Give it Tesla. Give it to T-Boone Pickens. Give it to anyone EXCEPT GM, Chrysler, and Ford. They are unprofitable, unsupportable, shrinking companies. There is a reason the market is punishing them, and it is NOT just exorbitant labor costs. It is just that no one is buying their latest models. Why is no one talking about bailing out Toyota? Ask yourself this. Then ask yourself what differentiates the workers in a Toyota plant (int he US) that isn't getting bailed out from the workers in a GM plant who might be.

So take the bail-out money (from the 700 billion), give all the money to the recently laid off workers in the forms of scholarships for community colleges and/or worker re-training programs and move on. Let the CEO's and the inefficient corporations die on their own. Still don't believe me? Change the name of Ford to Wal-mart. Are you still willing to give them a bail out? Especially when Wal-mart employs more people than Ford does? I thought not.

Manufacturing is dead. Long live the US economy.

And Pelosi... I despise your position. I want to move to San Francisco and vote against you. Retake ECON 101 you poor congressperson and learn what supply and demand is all about before you talk about how car manufacturing is good for America. And before you wave around BLS reports trying to frighten everyone else into your point of view. If you want to be truly progressive and lead the US into the future, you will lead them into the future on more than token social issues. Take the lead on REAL economic issues, and be the Speaker that we all know and expect you to be, instead of a puppet politician for certain groups.

Change is inevitable. Very few of us will have the jobs of our fathers and forefathers. The car maker, the farmer, the banker, they are all our past. If we cannot let go of our past we are doomed to be trapped by it. The future is now. If you cannot adapt, then get out of the way and don't run for elected office. People foresee the end of capitalism... I see on the horizon the closest realization we can get to of "Economic Man." The mobile the adaptive, and the self aware utility maximizing consumer who supplies his labor where necessary and trades for goods on a global market where perfect competition is prevalent. Markets are reacting faster than ever. Capital and Labor are shifting between sectors faster than ever. The Invisible Hand is far from dead. In fact the recession is the Invisible Hand doing what it is supposed to be doing: cleaning house every now and then. Recessions are a part of it, and to be expected, especially after long periods of rampant speculation. We still live in the age of Schumpeter, Keynes, Smith, and yes Friedman (heresy of heresies!).

Look, we can do better. We have the opportunity in this crisis to better ourselves. The chains of past expectations are falling off, and the possibility of building a new future is rising. It all depends on how you look at it.
Are we going to hold on to a historic and crumbling sector of our economy, or free up labor and resources to let other sectors grow? Are we going to pump billions of dollars into trying resuscitate what is already dead?

Seriously though... a car czar? Are you KIDDING ME?
Anyone from DC who wants to tell me how to live my life and run my business can just turn around and walk away now.

Edited at 9:07 AM to change cut early morning "crazy man" rants. All apologies to Mrs. Pelosi, Tom Brokaw, and the UAW.