Christmas Stimulus

George Will has a provocative column up right now making the point that Christmas actually hurts our economy, and I love these kinds of provocative points, but I'm not sure I agree with everything he's saying here.

Here are the main points:

We are actually usually pretty bad at giving gifts people actually want:
"Gifts that people buy for other people are usually poorly matched to the recipients' preferences. What the recipients would willingly pay for the gifts is usually less than the givers paid. The measure of the inefficiency of allocating value by gift-giving is the difference between the yield of satisfaction per dollar spent on gifts and the yield per dollar spent on the recipients' own purchases."

Stimulus spending is actually counter-productive
"At least the Christmas stimulus strengthens the economy, right? Wrong, says Waldfogel. If all spending justified itself, we would pay people to dig holes and then refill them -- or build bridges to unpopulated Alaskan islands. Spending is good if the purchaser, or the recipient of a gift, values the commodity more than he does the money it costs. Otherwise, there is a subtraction from society's store of value."

The second point could actually be made to counter the arguments for a government stimulus as a way to combat unemployment.

The article makes some useful suggestions - give gift cards instead of gifts. And gift cards to charities for the affluent who already have everything they need.

I just want to make some counterpoints:

1. The best gifts are gifts I have received and loved but would never have gotten for myself. My sister gave me the generous gift of a New Yorker subscription - which I loved and have continued today. Or last year my sister-in-law took all of my wife's weekly updates she sends out to friends and family (with a brief summary of our week with pictures) and created a beautiful bound book for us. In other words, sometimes others can spend money on us much more efficiently than we can spend on ourselves. Admittedly, this requires pretty deep understanding of the recipient and usually the giver has to have some skill to do so.



2. Sometimes the recipient just has no money for many needs let a lone wants, so its all of the sudden pretty easy to give that person something they really, really want because they need and want a lot. I think children qualify pretty well on that count. So, you can use Christmas as a way to introduce a little magic in their lives and a way to satisfy the parental desire to indulge them while blaming the indulgence on Santa Claus.



3. Christmas as stimulus is a stimulus if you have 10% unemployment, people aren't working because nobody wants want they're selling. If we use the holidays as an opportunity to spend a little more than we otherwise would have, getting a bit more money into circulation, then it should help as a stimulus. And the pay someone to dig a hole argument doesn't make complete sense because it is better to pay someone to do something 100% useless if the alternative is that they stay at home feeling 100% useless, unneeded and unwanted. At least they are working. But obviously, the better we are at spending stimulus toward things people want and need the richer we become. For example, last year I gave my parents tickets to community theater - they loved it, it helped keep the local actors working and my parents just don't do this kind of stuff on their own - stimulus, stimulus, stimulus.



4. Christmas as a way to build and strengthen relationships. If you give something personal to someone, even if they didn't exactly want it, I think "it's the thought that counts" really counts, especially if the gift is really thoughtful. Homemade gifts apply here quite well.

But I think the article makes some good points. Gifts to charity for people who really have the means to buy what the want (especially if you don't have any special insights that would give you the ability to give them something they just wouldn't have thought to buy for themselves) is a really, really good idea.

Or you know, I'm 38, I'm really past the point where all I want for Christmas is a lot of good times with my friends and family. (I remember getting really annoyed when my parents would say something along those lines... :-))...

And you know, I can go ahead and buy the new Motorola Droid phone for myself for Christmas.

Some idle thoughts on global warming

This is an odd time to be talking about global warming admittedly. National and global politics is primarily focused right now on the economy, our middle east wars, and the health care debate. But there is a cap and trade bill out there and it will eventually (sometime in 2010?) be considered. But mostly, I've had this interesting debate with some facebook friends who seem to be pretty steady in the camp of global warming deniers.

Really, Megan McArdle sums up pretty nicely my feelings of how most people see this issue in this blog post with this comment:

"Also in the WTF category, Pew says there was a fourteen point drop in the number of Americans who believe there is solid evidence that anthropogenic global warming is real. I mean, maybe 45 million Americans spent the last year reviewing the scientific evidence on Global Warming and changed their minds. Certainly, a lot of laid-off workers have some time on their hands. But this doesn't really seem a spectacularly likely explanation of the phenomenon.

I can only come up with two explanations for this phenomenon: one, that many Americans are happy to embrace a symbolic belief in global warming as long as there is no danger that anyone will do anything about it. The other is that Americans don't know what they want, and also, enjoy messing with pollster's minds."

Global warming is an incredibly complicated issue that aligns quite nicely within the natural boundaries of the cultural war this country has been fighting since the 1960's. The liberals are always looking for new ways to put the reigns on the excesses of the free market. And environmentalists have a deeply embedded agenda and, as such, have a deep interest in preserving the environment even when it takes some pretty significant market sacrifices to do it.

Of course the conservative agenda is quite opposed to both points of view, believing in the free market likes it is some kind of religion; that all of our problems can be attributed government regulation. Obviously, I'm simplifying the positions of both sides, and I know that folks in both camps have authentic and sophisticated points of view. But just go with me right now for the sake of discussion.

The science behind global warming is complicated. This article gives a very high level history of some of it and makes an interesting proposal on how to deal with its consequences. Obviously, written in 2000, its incredibly dated, but the points it makes are still valid today, I think.

I am not a climatologist (obviously) and I have only a very superficial view of the science of global warming. But I have read fairly extensively over the years on the subject, and my impressions are that the scientific evidence that CO2 emissions have caused and will continue to cause a warming of the earth's temperature is pretty overwhelming. I do get the impression that there are some significant and serious scientists dissenters to this point of view, but I don't have a good understanding of their exact position on the subject.

I also feel that though the earth seems to be warming because of human activity, the solutions on how to address this are politically difficult and mostly not feasible, at least right now in our current political climate.

The problem is that global warming is so subtle. Global temperatures vary from year to year and from region to region pretty randomly and for a large number of reasons. The slow upward trajectory the earth is currently on is completely unnoticeable so it has no impact on the average person's day to day life. You can say that the severe weather we are seeing is a result of warming, but this is difficult to prove. We have always had hurricanes on this good earth of ours, it's impossible to say that Hurricane Katrina, say, would not have happened if not for the Industrial Revolution.

Which leads to another point, cheap oil is at the foundation of our economy. Any attempts to make it more expensive will definitely be noticed and will have a deep global economic impact. Also, to really be serious about reducing carbon emissions, it requires global cooperation that is virtually impossible to get. Basically you are telling emerging economies to stop growing so fast. Because as these countries begin to prosper, there per capita carbon footprint will grow as well, more than negating any marginal efforts we make through cap and trade.

But still I'm in favor of cap and trade. Because I believe the answer to the global warming problem is innovation in both alternative energy sources and in energy conservation. I believe this innovation is well within our reach and adding a small amount of tax on carbon will help make those energy sources more competitive, spurring greater levels of venture capital money in that direction.

But why the fervor among the global warming deniers? I do believe those who are pushing for significant political solutions to solve the global warming problem are inclined to over-reach. I believe that they have been guilty of manipulating the data to make their case more appealing. I think this instance of over-reach have fueled the denier's conspiracy theory that the whole thing is a hoax designed to take away freedoms and to grow the government. This point of view, by the way, has some truth to it.

But as a caveat to this entire discussion, I am far from an expert on this issue, and am open to moving my opinions in any direction as I receive more information. I think this issue is both important enough and complex enough to warrant a bunch more humility from both sides.

I don't understand this war on the moderates

I've been hearing somewhat anecdotally how there's this movement to try to oust RINO's from the party. What's a RINO you ask, well the acronym should give it a way: (Republican in Name Only). How does one earn this label I still want to know because I'm not entirely sure I get it. But if I had to wager a guess, its tagged on anyone who dares vote against the party line, e.g. a moderate.

And the Democrats are not completely guilty either, although not nearly so as the Republicans right now. But I've heard that MoveOn wants to give a big financial push in supporting primary opposition candidates who are running against any "moderate" Democrat who dares vote against the health care bill.

Can someone please help me understand this? It makes no political sense to me. There's a reason we have moderates in Congress - because they represent moderate districts. If your party successfully ousts a moderate in the primaries with someone more ideologically "pure" - whatever that means, you are practically ensuring that you'll lose that district in the general election.

Run an extreme liberal against a moderate Republican in such a district, expect to see a Republican taking that seat for the next 2 years. And this runs even stronger if the economy remains in the doldrums in the 2010 election cycle - which it most assuredly will. Incumbents will naturally be in trouble in such conditions (fairly or not). So I suppose if you're running a more extreme candidate against a moderate incumbent, you have some chances of winning that seat. And I guess that's what the current Republican strategy is banking on. But its almost certainly not a sustainable strategy.

Get a voting record behind that less moderate candidate, and that protest vote that got her elected will turn against her just as fast.

What the Republicans are missing in spades is a viable message that resonates broadly as a viable alternative solution to what the Democrats are offering. They have become the protest party, the party of no. And until they figure this out, even if they succeed in picking up some seats in 2010 (with a big assist from a miserable economy) I have no idea how this is a long-term winning strategy.

Flow and Politics

Loved this section:

The Wider Community

A person is part of a family or a friendship to the extent he invests psychic energy in goals shared with other people. In the same way, one can belong to larger interpersonal systems by subscribing to the aspirations of a community, an ethnic group, a political party, or a nation. Some individuals, like the Mahatma Gandhi or Mother Theresa, invest all their psychic energy in what they construe to be the goals of humanity as a whole.

In the ancient Greek usage, "politics" referred to whatever involved people in affairs that went beyond personal and family welfare. In this broad sense, politics can be one of the most enjoyable and most complex activities available to the individual, for the larger the social arena one moves in, the greater the challenges it presents. A person can deal with very intricate problems in solitude, and family and friends can take up a lot of attention. But trying to optimize the goals of unrelated individuals involves complexities an order of magnitude higher.

Unfortunately, many people who move in the pubic arena do not act at very high levels of complexity. Politicians tend to seek power, philanthropists fame, and would-be saints often seek to prove how righteous they are. These goals are not so hard to achieve, provided one invests enough energy in them. The greater challenge is not only to benefit oneself, but to help others in the process. It is more difficult, but much more fulfilling, for the politician to actually improve social conditions, for the philanthropist to help out the destitute, and for the saint to provide a viable model of life to others.

If we consider only material consequences, we might regard selfish politicians as canny because they try to achieve wealth and power for themselves. But if we accept the fact that optimal experience is what gives real value to life, then we must conclude that politicians who strive to realize the common good are actually smarter, because they are taking on the higher challenges, and thus have a better chance to experience real enjoyment.

Any involvement in the public realm can be enjoyable, provided one structures it according to the flow parameters. It does not matter whether one starts to work with the Cub Scouts or with a group exploring the Great Books, or trying to preserve a clean environment, or supporting the local union. What counts is to set a goal, to concentrate one's psychic energy, to pay attention to feedback, and to make certain that the challenge is appropriate to one's skill. Sooner or later the interaction will begin to hum, and the flow experience follows.

Of courses, given the fact that psychic energy is in limited supply, one cannot expect that everyone will be able to become involved in public goals. Some people have to devote all their attention just to survive in a hostile environment. Others get so involved with a certain set of challenges - with art, for instance, or mathematics - that they can't bear to shift any attention away from it. But life would be harsh indeed if some people did not enjoy investing psychic energy in common concerns, thereby creating synergy in social systems.

The concept of flow is useful not only in helping individuals improve the quality of their lives, but also in pointing out how public action should be directed. Perhaps the most powerful effect flow theory could have in the pubic sector is in providing a blueprint for how institutions could be reformed so as to make them more conducive to optimal experience. In the past few centuries economic rationality has been so successful that we have come to take for granted that the "bottom line" of any human effort is to be measured in dollars and cents. But an exclusively economic approach to life is profoundly irrational; the true bottom line consists in the quality and complexity of experience.

A community should be judged good no because it is technologically advanced, or swimming in material riches; it is good if it offers people a chance to enjoy as many aspects of their lives as possible, while allowing them to develop their potential in the pursuit of ever greater challenges. Similarly the value of a school does not depend on its prestige, or its ability to train students to face up to the necessities of life, but rather on the degree of the enjoyment of lifelong learning it can transmit. A good factory is not necessarily the one that makes the most money, but the one that is the most responsible for improving the quality of life for its workers and its customers. And the true function of politics is not to make people more affluent, safe, or powerful, but to let as many as possible enjoy an increasingly complex existence.

But no social change can come about until the consciousness of individuals is changed first. When a young man asked Carlyle how he should go about changing the world, Carlyle answered, "Reform yourself. That way there will be one less rascal in the world." The advice is still valid. Those who try to make life better for everyone without having learned to control their own lives first usually end up making things worse all around.


That last paragraph explains exactly why I was so hard on Bill Clinton during the 1990's... He just didn't seem right to me, and I guess the Monica Lewinsky scandal confirmed that for me. In retrospect, he governed better than I gave him credit, and I'm sure the Republican party at the time was on a witch hunt. But despite some of his successes (he reduced the deficits drastically and presided over a pretty prosperous time, and some of that was because of his policies - although most of that came because of the internet revolution), but I think also he governed selfishly, looking mostly toward his own legacy, concerned more over how he was seen by others.

The Bush Jr. presidency was different I think. More or less, I think Bush was probably a pretty good, sincere person, but prior to the presidency, I'm not sure how much he really had to push himself toward difficult goals. Sure he was governor of Texas, owner of the Rangers, etc. But most everything he got was received with a pretty serious assist from his name and his family connections. And his resume was bereft of any really serious accomplishments, and plenty of failures litter his stat sheet. I think his brother Jeb may have been a better candidate and probably would have been a better president.

As a result, much of the first six years of his presidency was presided over more by Cheney than him, especially foreign policy. And his administration was very slow to react, to recognize the failures of their actions and to adapt. Most notably, the Iraq war deteriorated for 6 years without any adjustments, until Rumsfeld was tossed aside and the reigns were handed over to Patreus. And although Paulson and Bernanke responded violently quick when it became obvious the economy was teetering, we got to that point, under the neglectful care of Bush and his administration.

With Obama, I remain hopeful, but his presidency is still young. Unlike Bush, Obama has worked his way up from a much lower rung of the ladder. And he has seen some significant life accomplishments, especially academically and politically. His main successes were in the classroom - both as a student and as a professor (he was a constitutional law professor at the University of Chicago for 8 years) and as a campaigner: he knew how to work the political machine to get ahead. And his campaign for president was masterful and disciplined. You could say this was not sufficient enough to qualify him for the presidency, and I would agree. But in my view, he was significantly more qualified than Bush was before him. And more suited for the office than Clinton, so has the chance to exceed both of his predecessors.

But he also faces much more complicated challenges: two wars, a tinderbox in the Middle East, a global recession with unprecedentedly high unemployment, a health care system that is on a trajectory to bankrupt our country, serious global warming concerns, and a toxic and politically poisoned political environment.

I think his first year has been good but not great. He has not lived up to impossibly high expectations many had of him. Given his experience and the circumstances he faces, I think it was unrealistic to have expected him to live up to some of our past great presidents - at least right away.

I'm still not sure if his pursuit of the presidency was a pursuit of political power or a pursuit to take on the challenge to improve our country. I expect its a combination, but we'll know more as we see things progress.

But even if he is doing everything he's doing for the most sincere reasons, I'm not sure whether his administration is even capable to meet the incredibly complex challenges he is being asked to face.

In fact, on his own, its impossible. He needs the cooperation of both political parties and the minority party serves an important purpose in this regard. All successful presidents have to work with the opposition party at least to some degree and the Republican party can if they desire do nothing more than to try to sabatoge President Obama at every turn.

Or they can try to work with him to come up with viable solutions in the spirit of compromise.

I hope we see the latter. I'm afraid we're getting too much of the former.

Flow - Families, Teenagers

This is from the section on families, I pulled out the section starting on teenagers with some nice summary comments on the family as a whole. Really powerful stuff in here:

Teenagers are physiologically mature beings, rife for sexual reproduction; in most societies (and in ours too, a century or so ago) they are considered ready for adult responsibilities and appropriate recognition. Because our present social arrangements, however, do not provide adequate challenges for the skills teenagers have, they must discover opportunities for action outside those sanctioned by adults. The only outlets they find, all too often, are vandalism, delinquency, drugs, and recreational sex. Under existing conditions, it is very difficult for parents to compensate for the poverty of opportunities in the culture at large. In this respect, families living in the richest suburbs are barely better off than families living in slums. What can a strong, vital, intelligent fifteen-year-old do in your typical suburb? If you consider that question you will probably conclude that what is available is too artificial, or too simple, or not exciting enough to catch a teenager's imagination. It is not surprising that athletics are so important in suburban schools; compared to the alternatives, they provide some of the most concrete chances to exercise and display one's skills.

But there are some steps that families can take to partially alleviate this wasteland of opportunities. In older times, young men left home for a while as apprentices and traveled to distant towns to be exposed to new challenges. Today something similar exists in America for late teens: the custom of leaving home for college. The problem remains with the period of puberty, roughly the five years between twelve and seventeen: What meaningful challenges can be found for young people that age? The situation is much easier when the parents themselves enjoy playing music, cooking, reading, gardening, carpentry, or fixing engines in the garage, then it is more likely that their children will find similar activities challenging, and invest enough attention in them to begin enjoy doing something that will help them grow. If parents just talked more about their ideals and dreams - even if these had been frustrated - the children might develop the ambition needed to break through the complacency of their present selves. If nothing else, discussing one's job or the thoughts and events of the day, and treating children as young adults, as friends, help to socialize them into thoughtful adults. But if the father spends all his free time at home vegetating in front of the TV set with a glass of alcohol in his hand, children will naturally assume that adults are boring people who don't know how to have fun, and will turn to the peer group for enjoyment.

In poorer communities youth gangs provide plenty of real challenges for boys. Fights, acts of bravado, and ritual displays such as motorcycle gangs parades match the youths' skills with concrete opportunities. In affluent suburbs not even this arena for action is available to teenagers. Most activities, including school, recreation, and employment, are under adult control and leave little room for the youths' initiative. Lacking any meaningful outlet for their skills and creativity, they may turn to redundant partying, joyriding, malicious gossiping, or drugs and narcissistic introspection to prove themselves that they are alive. Consciously or not, many young girls feel that becoming pregnant is the only really adult thing they can do, despite its dangers and unpleasant consequences. How to restructure such an environment so as to make it sufficiently challenging is certainly one of the most pressing tasks parents of teenagers face. And it is of no value simply to tell one's strapping adolescent children to shape up and do something useful. What does help are living examples and concrete opportunities. If these are not available, one cannot blame the young for taking their own counsel.

Some of the tensions of teenage life can be eased if the family provides a sense of acceptance, control, and self-confidence to the adolescent. A relationship that has these dimensions is one in which people trust one another, and feel totally accepted. One does not have to worry constantly about being liked, being popular, or living up to others' expectations. As the popular sayings go, "Love means never having to say 'I'm sorry,'" "Home is where you're always welcome." Being assured of one's worth in the eyes of one's kin gives a person the strength to take chances; excessive conformity is usually caused by fear of disapproval. It is much easier for a person to try developing her potential if she knows that no matter what happens, she has a safe emotional base in the family.

Unconditional acceptance is especially important to children. If parents threaten to withdraw their love from a child when they fail to measure up, the child's natural playfulness will be gradually replaced by chronic anxiety. However, if the child feels that his parents are unconditionally committed to his welfare, he can then relax and explore the world without fear; otherwise he has to allocate psychic energy to his own protection, thereby reducing the amount he can freely dispose of. Early emotional security may well be one of the conditions that helps develop an autotelic personality in children. Without this, it is difficult to let go of the self long enough to experience flow.

Love without strings attached does not mean, of course, that relationships should have no standards, no punishment for breaking the rules. When there is no risk attached to transgressing rules they becoming meaningless, and without meaningful rules an activity cannot be enjoyable. Children must know their parents expect certain things from them and that specific consequences will follow if they don't obey. But they must also recognize that no matter what happens, the parents' concern for them is not in question.

When a family has a common purpose and open channels of communication, when it provides gradually expanding opportunities for action in a setting of trust, then life in it becomes an enjoyable flow activity. Its members will spontaneously focus their attention on the group relationship, and to a certain extent forget their individual selves, their divergent goals, for the sake of experiencing the joy of belonging to a more complex system that joins separate consciousness in a unified goal.

One of the most basic delusions of our time is that home life takes care of itself naturally, and that the best strategy for dealing with it is to relax and let it take its course. Men especially like to comfort themselves with this notion. They know how hard it is to succeed in the job, just want to unwind, and feel that any serious demand from the family is unwarranted. They often have an almost superstitious faith in the integrity of the home. Only when it is too late - when the wife has become dependent on alcohol, when the children have turned into cold strangers - do many men wake up to the fact that the family, like any other joint enterprise, needs constant investment of psychic energy to assure its existence.

To play the trumpet well, a musician cannot let more than a few days pass without practicing. An athlete who does not run regularly will soon be out of shape, and will no longer enjoy running. Any manager knows that his company will start falling apart if his attention wanders. In each case, without concentration, a complex activity breaks down into chaos. Why should the family be different? Unconditional acceptance, the complete trust family members ought to have for one another, is meaningful only when it is accompanied by an unstinting investment of attention. Otherwise it is just an empty gesture, a hypocritical pretense indistinguishable from disinterest.

Flow - Free Time

Loved this excerpt from the book:

The Waste of Free Time

Although, as we have seen, people generally long to leave their places of work and get home, ready to put their hard-earned free time to good use, all to often they have no idea what to do there. Ironically, jobs are actually easier to enjoy than free time, because like flow activities they have built-in goals, feedback, rules, and challenges, all of which encourage one to become involved in one's work, to concentrate and lose oneself in it. Free time, on the other hand, is unstructured, and requires much greater effort to be shaped into something that can be enjoyed. Hobbies that demand skill, habits that set goals and limits, personal interests, and especially inner discipline help to make leisure what it is supposed to be - a chance for re-creation. But on the whole people miss the opportunity to enjoy leisure even more thoroughly than they do with working time. Over sixty years ago, the great American sociologist Robert Park already noted: "It is in the improvident use of our leisure, I suspect, that the greatest wastes of American life occur."

The tremendous leisure industry that has arisen in the last few generations has been designed to help fill free time with enjoyable experiences. Nevertheless, instead of using our physical and mental resources to experience flow, most of us spend many hours each week watching celebrated athletes playing in enormous stadiums. Instead of making music, we listen to platinum records cut by millionaire musicians. Instead of making art, we go to admire paintings that brought in the highest bids at the latest auction. We do not run risks acting on our beliefs, but occupy hours each day watching actors who pretend to have adventures, engaged in mock-meaningful action.

This vicarious participation is able to mask, at least temporarily, the underlying emptiness of wasted time. But it is a very pale substitute for attention invested in real challenges. The flow experience that results from the use of skills leads to growth; passive entertainment leads nowhere. Collectively we are wasting each year the equivalent of millions of years of human consciousness. The energy that could be used to focus on complex goals, to provide fro enjoyable growth, is squandered on patterns of stimulation that only mimic reality. Mass leisure, mass culture, and even high culture when only attended to passively and for extrinsic reasons - such as the wish to flaunt one's status - are parasites of the mind. They absorb psychic energy without providing substantive strength in return. They leave us more exhausted, more disheartened than we were before.

Unless a person takes charge of them, both work and free time are likely to be disappointing. Most jobs and many leisure activities - especially those involving the passive consumption of mass media - are not designed to make us happy and strong. Their purpose is to make money for someone else. If we allow them to, they can suck out the marrow of our lives, leaving only feeble husks. But like everything else, work and leisure can be appropriated for our needs. People who learn to enjoy their work, who do not waste their free time, end up feeling tha their lives as a whole have become much more worthwhile. "The future," wrote C. K. Brightbill, "will belong not only to the educated man, but to the man who is educated to use his leisure wisely".