Debt II

 

Pretty Polly

A debt to the devil, Willie must pay
A debt to the devil, Willie must pay
For killing Pretty Polly, and running, and running, and running, and running away. 

Is our national debt to the devil?

To answer my own question, the national debt is an investment in the future, NOT a debt to the devil.  Since we have a fiat currency that is based on the national economy, our national debt should be a percentage of the national economy.  That way if the economy grows, the debt ceiling will also grow.  Also the debt ceiling should NEVER be set in unadjusted dollars.  The US currency has been subject to inflation, especially beginning with the Nixon Shock of 1971.   The debt ceiling should recognize this inflation.  If the economy is stated in current dollars, not in the dollars of a previous year, then the debt ceiling should also be based on the economy stated in the current years dollars, and not the dollars of a previous year.

It is arguable that there should not even be a national debt ceiling set by Congress.  Congress has the power of appropriation in spending bills.  And the ability to raise taxes to pay for that spending. Then why is there also a need to also impose a  national debt ceiling on that spending. The debt ceiling should not be used as a hostage to hold spending, or taxes, hostage.  Yes, if there is no debt there is no need for spending, or taxes, to repay that debt.  But then there is also no investment in the future.  If you believe in the future, and you believe in growth, then you have to also allow for debt. 

Equality

 

My Back Pages

A self-ordained professor’s tongue
Too serious to fool
Spouted out that liberty
Is just equality in school
“Equality,” I spoke the word
As if a wedding vow
Ah, but I was so much older then
I’m younger than that now

I am older now but I wish I was younger.  What is equality?

The Microsoft Word Thesaurus lists the synonyms for equality as: parity, fairness, equivalence, likeness, impartiality, etc. And this highlights the problem with equality. Equality IS ALWAYS fairness and impartiality. Equality IS NOT ALWAYS likeness and equivalence. It is easy to treat those that are identical to me with fairness. It is much harder to treat those who are unlike me with fairness.

Which begs the questions, what is fairness? That same thesaurus lists the symptoms for fairness, not including equality, as: justice, impartiality, objectivity, etc. Which means that equality is not having your thumb on the scale of justice, letting things truly be random. Being fair is being objective and impartial and NOT favoring one outcome over another. Justice is not the Law. The Law should reflect Justice, but that Law is not perfect, and we can change the Law. We can not change Justice. It is an absolute. We can aspire to absolutes, but we can not be absolutes. A normal distribution of a group, i.e. a fair distribution, has a mean and a standard deviation from that mean. An absolute has a standard deviation of zero by definition. But humans are members of a group. As such, we are individuals, not absolutes. A standard uniform normal distribution of a group has a standard deviation of 1, not 0. Equality is accepting that fact and not insisting that everyone be like you, have a standard deviation of 0 from you

Equality is everyone sharing the same starting line, and letting true randomness govern the outcome. That is why jockeys in a horse race, or boxers in a match, have weigh-ins. It is why in golf there are handicaps, and why in chess there are rankings. If you beat an unequal opponent that is NOT a reason to celebrate. If you have to take actions to ensure that your opponent is equal, then that will be a victory to celebrate. Sometimes that may involve tying your hand behind your back, sometimes that may involve untying your opponents’ hands.

Bank Runs

 

I Gotsta Get Paid

I got 25 lighters on my 25 folks
Gonna break the bank run 25 more
Bout to reap the suits with 25 flows
I got 25 lighters well don't ya know
You know I gotsta get paid

It has been along time since we have had a bank run.

In the 19^th Century bank runs were common. (For those of you who are too young to remember bank runs, see https://www.youtube.com/watch?v=iPkJH6BT7dM.)  This is because banks do NOT keep enough liquidity on hand to pay out all deposits, nor would we want then to do so. There has to be a lender of last resort who can provide the liquidity to repay depositors when a single bank can not. Otherwise depositor demands at one bank can trigger a panic among depositors in other banks. In the 19h century that lender of last resort was banker J. P. Morgan. Since the Federal Reserve was formed, it has been that lender of last resort.

In crypto currency there is no lender of last resort. Crypto is also a commodity currency. There is a fixed amount of crypto that can be “mined.” Gold and other precious metals once served as the basis of a commodity currency. Sovereigns minted coins to guarantee that the currency was real gold, etc., and could be faithfully used in an economic exchange. But gold and other metals are bulky to carry which is why there is paper money. We had a gold currency because Isaac Newton, of Gravity and Calculus fane, when he was Master of the British Royal Mint, made a mistake on the price of silver. Before this mistake, silver was also commonly the basis for a nation’s currency. A remnant of that is the Pound Sterling which was a weight of sterling silver, and the dollar which was a Spanish coin in silver. When paper currency, which was easier to carry,  could be converted into gold, then it was still a commodity currency. Since the 1930s, Americans were virtually not allowed to own gold. The domestic dollar effectively became a fiat currency. It was worth what those printing the money said it was worth. Beginning in 1971, the dollar was also no longer internationally convertible into gold.

A commodity currency can NOT grow. It is constrained by the amount of that commodity. To allow growth, an economy should NOT have a commodity currency. But that begs the issue of what is the constraint on a fiat currency. The answer appears to be an amount that is consistent with the goods and services in the economy that it supports. If the economy grows, then the fiat currency should also grow by this amount.

As was noted, in crypto currency there was no lender of last resort and crypto was a commodity currency. Thus it should not be surprising that crypto currency markets such as FTX have collapsed. That most people did not own or invest in crypto currency is why a run on crypto did not also cause a run on the banks.

John Aniston, R.I.P.

 

Oh My Papa

Oh, my Pa-pa, to me he was so wonderful
Oh, my Pa-pa, to me he was so good
No one could be so gentle and so lovable
Oh, my Pa-pa, he always understood

There is a fitting way to honor Jennifer Aniston’s late father, Yannis Anastassakis.

In ancient Athens, they took jury duty and voting selection very, very seriously. But their answer was NOT to exclude those that might be corrupted. They instead ensured that the process was absolutely random so that corruptible humans were not involved. The representatives and jurors were chosen from among volunteers. There was a concern that the votes, or other decisions, of those representatives and jurors could be influenced by others, if their votes were public. Their solution was to make such votes secret. It did NOT require a high-tech solution. They deposited stones indicating their decision in a jar, where the color of the stone indicated whether they were in favor of, or opposed to, the issue. The number of stones in the jar indicated the will of the panel but no one could see, or influence, the decision of any one member of the panel.

There was also a concern that each of the ten tribes in Athens were fairly represented on any panel of representatives, jurors, etc. They often used a kleroterion to select panels.

From Wikipedia. https://en.wikipedia.org/wiki/Kleroterion

“The kleroterion was a slab of stone incised with rows of slots and with an attached tube. Citizens' tokens—pinakia—were placed randomly in the slots so that every member of each of the tribes of Athens had their tokens placed in the same column. There was a pipe attached to the stone which could then be fed dice that were colored differently (assumed to be black and white) and could be released individually by a mechanism that has not survived to posterity (but is speculated to be by two nails; one used to block the open end and another to separate the next die to fall from the rest of the dice above it.) When a die was released, a complete row of tokens (so, one citizen from each of the tribes of Athens) was either selected if the die was colored one color, or discarded if it was the alternate color. This process continued until the requisite number of citizens was selected.”

Selecting candidates from the tribes of ancient Athens is not terribly different from Harvard selecting candidates representing different races, incomes, ethnicities, etc. The chances of being selected were greater for those in a tribe with fewer volunteers/candidates. But the process was completely random.  Your odds were equal within your tribe. That they were not equal with every member of every other tribe was a big so what. That was NOT the goal. 

Choosing anything as a selection criteria, which is strongly correlated with race, income, ethnicity, etc., means that you are effectively selecting on race, income, ethnicity, religion etc. For example, if you are selecting based on extra-curricular activities and white, rich, WASPs have a higher correlation with extra curricular activities this means that effectively you ARE selecting on race, income, ethnicity, religion, etc.  Selecting as the ancient Greeks did, eliminates the possibility of using any highly correlated criteria.

I just learned that Jennifer Aniston is of Greek heritage.  It would be fitting to honor her late father by realizing that Affirmative Action is nothing more than the modern equivalent of the kleroterion, even if the ancient Greeks did it better,  and that votes to end debate in the US Senate be by colored stones instead of filibusters.

Lord of the Rings

 

Into the West

Why do you weep?
What are these tears upon your face?
Soon you will see
All of your fears will pass away
Safe in my arms
You're only sleeping!

But you can dream while you are sleeping.

I will admit to being a Lord of the Rings, LOTR, nerd.  One of the consequences of the COVID pandemic is that I have not able to get to the local public library and checkout out the LOTR trilogy for a read.  Before I went all Marie Kondo, and threw them out, I had a had a well-worn box set of the three books that I would reread often.

My three favorite characters in the LOTR are Samwise Gamgee, Treebeard, and the shield maiden Eowyn.  Upon reflection, I realize that these characters embody the three attributes that I have proposed as being important for understanding Human Behavior.        
 https://dbeagan.blogspot.com/2021/05/framework-for-human-behavior-ii.html

Eowyn is, doh, a shieldmaiden, and is thus NOT supposed to go into battle.  However she disguises herself, rides into battle with the men of Rohan, and it is she (and the likewise insignificant Hobbit Merry), who kills the Witch-King of Angmar and avenges King Théoden of Rohan, because she is a woman and NOT a Man.  Talk about never Excluding anyone!

Treebeard, Fangorn, is much to the Hobbits’ dismay, the opposite of hasty. He wants to discover the Truth after careful deliberation and debate.  But once he knows the Truth, watch out!

Samwise Gamgee, the loyal companion of Frodo, takes on the burden of carrying the Ring when he thinks Frodo has been killed, but surrenders the Ring when he discovers, much to his relief, that Frodo is alive.  Sam is the ultimate System Optimalist, who thinks of the group and NOT himself.  “It must be often so, when things are in danger, someone has to give them up,  lose them, so that others may keep them”.

Those who believed in excluding others; who did NOT believe in the Truth; and were User Optimalists who thought of themselves and NOT the group; were primarily defeated in the US general election on November 8^th.  I would like to think that the majority of voters, even those who are not LOTR fans, agreed with Tolkien.  I wish them good dreams.

Automatic

 

If I Only Had A Brain

I would not be just a nothin'
My head all full of stuffin'
My heart all full of pain.
I would dance and be merry,
Life would be a ding-a-derry,
If I only had a brain.

USING a brain beats HAVING a brain.

With all of the brouhaha about Artificial Intelligence, too often it is forgotten that this is just using a computer to execute a program. Unless the computer, the input data, and the formula in the program is correct, being able to execute it quickly or effortlessly, is NOT necessarily intelligent. It is NOT using the brain that you already have.

Grace Hopper, of the “It's Easier To Ask Forgiveness Than It Is To Get Permission” fame, recorded the first computer bug in 1947. The error was a hardware failure caused by a moth in the computer.

On Black Monday, October 19, 1987, the stock market plunged (the S&P 500 dropped nearly 10% in a single trading day) as computerized trading programs caused a market crash that could NOT be tracked to any other fundamental problems.

In 1998, the Mars Climate Orbiter was destroyed upon entering Mars' orbit at the wrong angle because the navigation team had entered calculations in the Imperial system (feet and pounds) and the program expected data in the metric system (meters and grams).

In 1999, global panic resulted when it was realized that the storage of only the last two numbers of a year,  e.g. 99 instead of 1999, might result in numerous computer errors.

In 2012, the Gangnam Style video broke YouTube because the maximum views allowed was stored as a 32-bit integer, which has a maximum of 2,147,483,647, and the number of views exceeded this.

In computer science, there is a phrase, GIGO, which means Garbage In, Garbage Out. This is true if the garbage is a hardware failure, an error in the input data, or a flaw in the program code. The important thing is to get the correct answer. Getting an answer quickly and cheaply, but getting the wrong answer is NOT using your brain.

Making something automatic when you are using the wrong formula in the code, is only getting to the wrong answer faster and more easily. The US Congress made the reapportionment of House seats after the decennial census automatic and an imbalance, e.g. between California and Wyoming seats per voter, is the consequence. John Taylor wanted to make the Federal Reserve Bank’s prime interest rate automatic but thankfully Congress did not make this mandatory. To err is human. But if you make an error, you are supposed to learn from that error, not replicate your mistake automatically.

Lauren Bobert III

Ding-dong! The Witch is Dead

Ding-dong! The Witch is dead
Which old Witch? The Wicked Witch!
Ding-dong! The Wicked Witch is dead
Wake up you sleepy head, rub your eyes, get out of bed
Wake up, the Wicked Witch is dead
She's gone where the goblins go
Below, below, below
Yo-ho, let's open up and sing and ring the bells out
Ding-dong's the merry-oh, sing it high, sing it low
Let them know the Wicked Witch is dead! 

Is Lauren Boebert finally DEAD !

Her electoral race  has not yet been called, but regardless of whether she wins or loses, the “angertainment” that Lauren Boebert represented hopefully is dead.  That Laruen Boebert has come as close as she has to losing a safe seat in Congress shows that many Republican voters  have finally realized that she is a “rINO, a republican In Name Only”.  

A Republican is some one who is supposed to believe in the republic outlined in the constitution.  She clearly believes that a powerful leader should make decisions for the group, which is an authoritarian form of government NOT the republic of the Constitution.  

A Republican believes that all of the People, as decibed in the Constitution, are included, not just white Christians. 

She may still eventually squeak by and win her seat but for the good of the US, let’s  hope that the “angertainment” and the position she represents, is, as they say in the song. “She's not only merely dead She's really most sincerely dead”