Progress against AIDS?

Haiti is renowned for its weak or non-existent institutions. Therefore it is both surprising and heartening to see the country making some progress against AIDS. In fact some of Haiti’s problems are being turned to its advantage, namely its large number of underemployed laborers, who are now being used to carry retrovirals to the desperately poor:

No program to treat people in the poorest countries has more intrigued experts than the one started in Haiti by Partners in Health – which has succeeded by enlisting help from hundreds among Haiti’s vast pool of unemployed and underemployed workers.

It is the rainy season now. So each morning and evening, 700 villagers strike out across dirt roads turned into a morass of mud and dung to deliver medicines to people with AIDS and tuberculosis. They tramp through muck and wade through streams on foot; a lucky few sit atop mules or donkeys.

Here is the full story. One leading participant noted:

“We didn’t do it to be a model program,” said Dr. Farmer, 44, a Harvard medical professor and anthropologist, who is also the subject of a recent book, “Mountains Beyond Mountains,” by Tracy Kidder. “We did it because people were croaking.”

Good news from Haiti is hard to come by, but here is another bit: Haitian artisans will have greater access to the web to sell their wares, visit this site, in addition to the brokers who sell through ebay. Haitian artisans, craftspersons, and artists are remarkably talented and hardworking, this is one of the few areas where Haitians can compete in world markets, this link shows one of my favorite Haitian voodoo flags, click on the hearts to see the larger image.

Does evolutionary biology weaken left-liberal views?

An interesting review of Steven Pinker’s The Blank Slate suggests that a better understanding of biology does not damage the prospects for social engineering, “The more we understand our nature, the better we’ll be at nurturing.” Here is one lengthier bit:

Contrary to what its critics say, evolutionary psychology does not threaten our ability to assess and transform our social and cultural landscapes. Quite the opposite–understanding the particular channels that we’re prepared to learn can throw into sharper relief the achievements of culture. Knowing something about our reproductive drives and our tendencies toward violence makes the extraordinary drop in murder and birthrates experienced by many Western countries over the past few centuries all the more impressive. And just because our mental modules are implicated in political issues, that’s no reason to hand over our societal reins to the evolutionary psychologists. To include biological explanations in a discussion of human society by no means eliminates the validity of other kinds of explanations. What Pinker and E.O. Wilson are proposing is not biological determinism but rather biological consilience…

This is half correct. Future social engineering, if done with noble motives and an informed basis, will have a better chance of succeeding a century from now. But I have long felt that the “public choice” critique of social engineering — you can’t trust people, especially not politicians — carries more weight than the informational critique. Scroll down one post and read my remarks on the all-too-frequent lack of meta-rationality as well, or scroll up one post and read about the prosperous marvel that is North Korea. And evoloutionary psychology suggests that, short of genetic engineering (not the topic at hand, and besides, who do you trust to do that?), human nature is not about to change anytime soon. So score at least half a point against social engineering, which should make Michael happy at www.2blowhards.com.

Meta-rational animals

Monkeys and dolphins are capable of recognizing when they do not know the answer to a question. Here is a brief summary of the experiments:

In the first one, trained monkeys sat at a computer joystick and watched the density of colored dots in a square on the screen. When there were many dots, the monkey moved the joystick to the square itself, choosing “dense.” When there were few dots, the monkey put the cursor on an “S,” superimposed on the screen, indicating “sparse.”

Gradually, examiners added more dots to the “sparse” test until the monkey reached a threshold where it could not easily discern whether the panel was “dense” or not. At that point, the monkey chose to put the cursor on a star, indicating uncertainty.

Smith said the two monkeys displayed uncertainty at almost the same threshold as seven humans who also took the test. This result, Smith and his co-authors said, “presents one of the strongest existing matches between human and animal performance in the comparative literature.”

In the second test, a bottlenose dolphin was trained to press a lever when it heard a “low” tone, and another lever when it heard a “high” tone. At first, the dolphin was so enthusiastic that it kicked up swirls of water as it raced to the levers.

But when researchers raised the low tone until it approached the high tone, “he would creep in because he didn’t know what to do,” Smith said. “It was the dolphin equivalent of scratching its head.” The dolphin would then resort to a third lever, indicating uncertainty.

In other words, very intelligent animals are aware of their own cognitive limitations, here is the full story. So far it has not been possible to induce comparable behavior in rats, nor in many political commentators.

The bottom line: Of all kinds of rationality, meta-rationality is perhaps the hardest to come by. It is most rare when more than one person, or questions of status, are involved. For whatever reasons, a kind of false certainty must have yielded evolutionary advantages in earlier times, and perhaps still does today. Those animals would really impress me if they dropped their admissions of uncertainty when a member of the opposite sex was watching.

Update on Medicare reform

Several days ago I predicted that the recent Medicare bill would turn out to be largely the prescription drug benefit, with little real institutional reform in the direction of privatization, for better or worse. An article in today’s New York Times provides a closely related argument.

Here is a summary:

The most politically charged feature of the Medicare legislation passed by Congress – its attempt to make the federal Medicare program compete with private managed-care plans – is also the least likely to come to fruition on the seven-year schedule set in the bill, according to health policy experts…Similar plans, the experts say, have failed to find support among patients, doctors and hospitals, or even some insurers. Even people who favor the idea say the potential for trouble this time is formidable…Many people enrolled in Medicare fear that they will end up with less generous benefits in a privately run program…Nor do hospitals and doctors like the idea of health insurers pushing down fees to make a profit for themselves, and health plans have balked at previous projects that threatened to squeeze their profit margins…In addition, many privately run Medicare plans, known as Medicare H.M.O.’s, withdrew from many areas of the country when government payments lagged, forcing millions of patients to scramble to obtain new coverage.

The bill passed by the House and Senate in the last few days calls for six-year demonstration projects in four to six cities, where private health plans would compete with the traditional Medicare program to enroll subscribers by offering a variety of new services with the goal of possibly reducing costs…But four previous attempts at experimenting with competition among Medicare H.M.O.’s were aborted before they began – blocked in Congress after members heard objections from health care providers and elderly voters.

Arguably this kind of “mixed privatization,” with strong public elements, and few real incentives for cost control, was not a good idea in the first place. But in any case it is unlikely to ever see the true light of day.

Why is housing so expensive in Manhattan?

Regulation appears to be part of the answer, as suggested by Arnold Kling, drawing upon research by Edward L. Glaeser, Joseph Gyourko, and Raven Saks, here is the original paper. The authors estimate that one-half the cost of constructing a Manhattan apartment is due to regulatory barriers and related inefficiencies.

And how much does a Manhattan apartment cost? Well, one estimate says the mean value is now $916,959, and the median value is $575,000, caveat emptor on these numbers but we all know it isn’t cheap.

As an aside, both the authors of the study and Steven Landsburg pose an interesting question. Why are not all buildings in a city block of the same height, given that their owners presumably face common costs and returns? The study authors cite regulatory factors, Landsburg cites non-convex building costs and diversity of demand.

Quotation of the day

…the GM [genetically modified] food controversy is a feature of societies for which food is not a life-and-death issue. In India, where people literally starve to death…up to 60 percent of fruit grown in hill regions rots before it reaches market. Just imagine the potential good of a technology that delays ripening, like the one used to create the Flavr-Savr tomato. The most important role of GM foods may lie in the salvation they offer developing regions, where surging birthrates and the pressure to produce on the limited available arable land lead to an overuse of pesticides and herbicides with devastating effects upon both the environment and the farmers applying them; where nutritional deficiencies are a way of life and, too often, of death; and where the destruction of one crop by a pest can be a literal death sentence for farmers and their families…The opposition to GM foods is largley a sociopolitical movement whose arguments, though couched in the language of science, are typically unscientific.

From James Watson’s recent DNA The Secret of Life, p.160, the book is also a good introductory read on DNA issues more generally.

By the way, here is a picture of aquarium fish, they are genetically modified to glow in the dark, thanks to Chris Mooney for the link and commentary.

Corporations and cheeses

Have you ever wondered why they call it Maytag cheese? As in the people who make the dishwashers and washing machines? There is in fact a close connection:

Maytag Blue
Nestled in among the rolling hills of central Iowa is the Maytag appliance factory. Down the road and around the corner is the Maytag Dairy, which produces Maytag Blue cheese, among other, lesser-known cheeses. Yes, the two are related. Fritz Maytag, son of the founder of the Maytag washing machine company, decided he wanted to make his own entrepreneurial mark on the world. Shortly before World War II, he began working with scientists at Iowa State University to begin making a great American blue cheese, modeled after those of Europe. The result was one of the first American farmstead cheeses of superior quality. The dairy is now independent of the appliance company and collects milk from a local dairy cooperative, rather than raising its own cows. Maytag cheese makers, however, are still hand making the same cheese that they created in the 1930’s. Maytag Blue’s popularity has taken off with the growing interest in American farmstead cheeses, and this wonderful, tangy blue cheese is now featured on menus across the country. Its wonderful flavor, moist yet crumbly texture, and lemony finish make Maytag one of the world’s great blue cheeses.

By the way, here is a good recipe for Maytag Blue, or just spread it on apples.

A neat story, no? Sadly, it all ends in subsidy. Here is a libertarian critique of government price support programs for dairy products:

In 1995 alone, wrote Kevin McNew in a Policy Analysis for the Cato Institute (December 1, 1999), taxpayers shelled out $8 billion to dairy farmers through various federal price-support programs…[According to James Bovard] “For the cost of the dairy program, each American family could have bought its own dairy cow.”

Little did I know that some of these subsidies go to the same people who make household appliances, I can’t possibly imagine any good reason for this.

Thanksgiving thoughts

It is a central point of economics to suggest that people are rewarded for their marginal product, and not for their infra-marginal contributions. Similarly, people have no guarantee of compensation for the external social benefits they produce. In other words, expect less gratitude than you probably deserve.

People who offer gratitude to others, however, tend to be much happier and more productive. This is a recurring theme throughout Gregg Easterbrook’s just published The Progress Paradox: How Life Gets Better While People Feel Worse. So on this Thanksgiving let us put aside the marginal product theory for a day, and feel gratitude for all that we have, which is indeed so very much. Without everyone else’s infra-marginal contributions, our lives would be sorry, short, and sad indeed. Perhaps, if only for a day, we should retitle this blog InfraMarginal Revolution.

Caviar facts

1. Venetian trading ships first brought caviar to Europe from the Black Sea in the fourteenth century.

2. Caviar remained obscure for another three hundred years. Shakespeare, in his Hamlet, even used the word caviar to refer to something unknown and obscure, Hamlet complains that this play was “caviare to the general.”

3. Galileo was an early fan of caviar.

4. Rabelais, in his tale of Pantegruel, refers to caviar as something ridiculous.

5. Many stocks of sturgeon around the world were exhausted through overfishing and “tragedy of the commons.” Russia has remained the world’s major source of caviar in part through accident. The chaos of WWI, the Bolshevik revolution, and the monopolies and inefficiencies of communism all helped prevent overfishing and preserve sturgeon stocks at critical points in time. This must be counted as one of the economic successes of the Soviet regime.

6. The sturgeon is now an endangered species and caviar movements are tightly regulated. A caviar smuggler can receive up to $20,000 for the contents of a single suitcase, those contents will sell “on the street” for as much as $100,000.

7. The future of caviar lies in fish farming and privately owned sturgeons.

These facts are all from Caviar: The Strange History and Uncertain Future of the World’s Most Coveted Delicacy, by Inga Saffron, an excellent book, or you can download it for $10.

The benefits of free trade

Read Brad DeLong’s excellent post on how we should think about the benefits of free trade, and how large those benefits might be. The basic problem is that when you measure the costs of protection, they don’t seem so enormous in many standard models. So why are economists so solidly behind free trade? Most of all, I’ll opt for his number three, the “missing link” move:

The missing link move: assert that domestic technological and organizational progress is closely and tightly tied to the volume of trade, considered as a proxy for social and technical contact and for the extent to which the government takes down the umbrella protecting inefficient national champions from the rains of competition.

In defense of short sellers

Read James Surowiecki’s insightful New Yorker column on the short selling of securities.

He notes:

Short sellers are investors who sell assets (a company’s shares, say) that they have borrowed, in the hope that the price will fall; if it does, they can buy the shares at a lower price, return them to the trader they borrowed them from, and pocket the difference. In effect, they are betting against a company’s stock price. As a result, they have, historically, been regarded with great suspicion…

But the fears of short sellers are largely unjustified:

Even when short sellers aren’t uncovering malfeasance, their presence in the market is useful. If you think of a stock price as a weighted average of the expectations of investors, restrictions on short selling skew that average by shutting out people with contrary opinions. It’s a bit like setting a point spread for a football game by allowing people to bet only on one side. When a team of Yale management professors did a study of forty-seven stock markets around the world, they found that markets with active short sellers reacted to information more quickly and set prices more accurately.

I’ll second his conclusion that “The case against these bears is a lot of bull.”

African Americans and Government

Tyler may be correct that “the government as employer has done more for black communities than the government as purveyor of affirmative action.” But isn’t there something disturbing about this? Consider the following: Who do you think wrote:

The widely proclaimed growth in the black middle class in the 1960s and early 1970s associated with claims of “dramatic black progress” were in large measure attributable to the expansion of Great Society programs and the professional employment repercussions at levels of government. These programs played less of a role in generating an increase in the black middle class by uplifting the black poor than by providing direct employment to many blacks as social service providers to other impoverished blacks. Thus, one of the main legacies of the Great Society was to cement the symbiosis between the black poor and the black middle class – the former as the clients of the social service system and the latter as the service providers.

No, it wasn’t Charles Murray. It was the radical-leftist economist William Darity Jr., himself an African-American, writing in the May 1990 issue of the AER (JSTOR link). If true, what this suggests is that even middle-class black Americans were, and perhaps are, much less well integrated into the American economy than we might think from income statistics. I find this disturbing from just about any angle.

Get your Flu Shot!

We do not respond to risks rationally. We are scared of Ebola, pesticides, nuclear radiation and terrorists but the flu? Who cares about the flu? You should. In an average year, the flu kills almost as many people as die in auto accidents (36,000 for the flu, 42, 815 for highway accidents in 2002) and this year experts expect some 50-70 thousand flu deaths. True, those over 65 years of age and older are most at risk but thousands of younger people die from the flu every year. A flu shot reduces your chances of death by 50 percent. (Here is more flu info from the CDC.)