Weekly Digest

Weekly Digest 6/14/18

Russ Roberts interviews Eric Topol – Great discussion about medical paternity. Many doctors withhold notes and decisions from patients under the pretext that the doctor knows best. We should instead be having healthy discussions between doctor and patient since sometimes that patient knows his/her body better than the doctor does. We expect financial advisers, lawyers, and our government to be transparent and don’t allow them to act autonomously under the guise of them “knowing best,” so why should we allow our doctors to do so? The Theranos discussion hasn’t aged well, but the rest of the interview is fantastic.

Mark Schreiber on how the name “Mao suit” came to be – The suit Kim Jong Un wears is called the “Mao suit” by English news services but is called the “Sun Yat-sen suit” (Zhongshan-zhuang) by the Chinese living in Asia. Interestingly, the name Zhongshan was a name adopted by Sun Yat-sen when he was in Japan out of fear of being abducted by agents of the Chinese imperial government. Therefore, the streets in China named Zhongshan road and the “Sun Yat-sen suit” originated from a Japanese alias, which is ironic because of the animosity historically between China and Japan.

Weekly Digest

Weekly Digest 6/7/18

Scott Alexander on suicide rates and guns – The US is an outlier in homicide rates but not in suicide rates even though there is a clear relationship between gun ownership and suicide rates but not between gun ownership and homicide rates. His conclusion is that if the US decreased its gun ownership, it would probably have even lower suicide rates and would be among the lowest in the developed world. He doesn’t mention it in this article, but conversely, decreasing gun ownership might not significantly decrease homicide rates.

Russ Roberts interviews Michael O’Hare about art museums – I learned so much from this podcast episode. The largest art museums only show around 5% of their collection at any given time, and since they continually acquire more art and perpetually display their staples, the majority of their collection never sees the light of day. O’Hare asserts that selling just 1% of their collection would not only allow the most well-known museums to fund admissions for perpetuity so that everyone could see their art for free, but would also give smaller art museums the opportunity to acquire more well-known works that currently aren’t seen by anyone. However, the current system all but prevents art directors from selling anything in their collection unless it is to acquire other works. So, we end up in a position nobody wants to be in: the largest art museums have so many works that will never see the light of day, works that smaller museums would kill for, and we have to pay ever increasing admission prices, ostensibly to provide the money “needed for a museum to operate.”

“The Education Tax Reduces Inequality and the Incentive to Work” – By Alex Tabarrok using data from David Leonhardt. College tuition is so much more expensive for Affluent families (~186k in income) than Upper-Middle families (~123k in income) that the earnings gap between them is smaller than first glance. Based on the data, when an Affluent family has 2 kids in college, their take adjusted income is actually less than an Upper-Middle class family. The post was thought provoking but I’m highly skeptical about this reducing the incentives of workers to earn more money.

The Verge article by Christine MacDonald on how Coca-Cola isn’t really water neutral – Good news: Coca-Cola is “water neutral,”ostensibly meaning that it gives back the same amount of water it uses. Bad news: its method of calculating its water use leaves out ~99% of its actual water use since it is only counting the water used in production, not the amount in its entire supply chain. For example, a half-liter of Coke takes ~35 liters of water to make (28L for growing sugar beets, 7L for the plastic bottle, and 0.4L for the actual liquid), but Coca-Cola is only counting its water use as 0.4L.

Helen Rosner on MSG – Mind blown. I had no idea that it’s been known for a while that MSG is not bad for you, despite the public perception, even among Asians, that it is. Why the perception? It originated from bad science, and possibly a dose of racism/xenophobia and then stuck despite many studies that have since debunked the myth. That it stuck illustrates the power of inertia and the difficulty in changing public opinion.

 

Weekly Digest

Weekly Digest 5/31/18

Scott Alexander weighs in on whether the thinks of “the intellectual dark web” can be silenced even though they’re popular – Scott points out the error in publications that conflate being popular with not being able to be silenced. Just because a popular proponent of a certain view cannot be silenced doesn’t mean that the other people supporting the same view, those without a big platform, cannot be. An example he gives, is that Caitlyn Jenner can be extremely famous, rich, and have a popular platform while transgender people, in general, can be stigmatized and oppressed. The two are not mutually exclusive (he also notes that he’s not comparing the marginalization that transgender people face with what supporters of “the intellectual dark web” face).

Dan Carlin Common Sense – Dan Carlin’s politics podcast. He rarely releases episodes so I’m always excited when he finally does.

Alex Tabarrok’s post on Andrew Leigh’s new book Randomistas – TOMS donates a pair of shoes for every pair bought. Instead of resting on its laurels, TOMS wanted to see the effect it was having and allowed economists to randomize shoe distribution to study the effects. The results weren’t great, and TOMS is reevaluating how it’s giving. The book sounds interesting and props to TOMS for studying the actual impact of their donations.

Latest This American Life episode – This episode documents one female airport security guard’s journey to combat discrimination. With all the news around MeToo today, we forget that low-paid, hourly female employees are probably the ones that face the most difficulties in overcoming gender barriers, and this episode shows just how hard it can be. I don’t think it’s hyperbole to call LaDonna a heroine.

Vox video explaining the rhymes of some of the greatest rappers ever – It’s so cool having some of the most iconic lines of rap broken down. Having a better understanding of how the verses are crafted gives me even more appreciation for songs that I already enjoyed.

Ezra Klein interviews Mehrsa Baradaran on costs imposed on black and poor people – The section that was most thought-provoking for me was when Mehrsa talked about the difficulties imposed on poor people who do not have access to banking. I take my checking account for granted, but if you’re poor, your checking account isn’t free, so you can’t afford one, which means that you have to go in-person to individually pay all of your bills. Crazy.

 

 

Weekly Digest

Tesla’s Moral Licensing and Worker Injuries

Tesla is the first successful American car company since Chrysler, which was founded in 1925. It completely revolutionized the automobile industry, forcing other car companies to shift their strategy to acknowledge the appeal of electric cars as a wonderful driving experience and as a status symbol for the liberal elite, who not only get to drive a beautiful car but who also get to feel virtuous while doing so. Tesla’s market cap is greater than Ford’s and almost as large as GM’s despite hemorrhaging cash and a lack of profit because the vision Elon Musk paints about its future is so captivating: the car’s eventual autonomous capabilities, the factory’s use of automation to rapidly scale manufacturing, the company’s strategy of building luxury cars to prove a concept and generate profit so that they can build cheaper mass-distribution cars, and of course, the company’s mission to stave off global warming. But the company has also had a history of labor violations which, I propose, stem from Musk’s penchant for over-promising and from moral licensing.

Move Fast and Break Things

Silicon Valley’s ethos is probably best summarized by Mark Zuckerberg’s famous quote “move fast and break things.” He may no longer subscribe to his own quote now that Facebook is out of its hyper-growth stage, but companies still in that stage, like Tesla, certainly still do. In F18 Q1, Tesla increased car production by 40% over the previous quarter, but was still almost 500 units under the Q1 target of 2,500 Model 3 cars, and it’s still aiming for 5,000 units per week by the end of Q2. Musk has a history of over-promising in order to push himself and his employees to the limit to try to meet those ludicrous goals. Moving fast and breaking things at software companies might lead to stressed out, sleep-deprived engineers, which is unfortunate but not disastrous. At a manufacturing company like Tesla, however, it can result in an unsafe work environment with a culture of downplaying and misreporting injuries.

Reveal, in a collaboration with KQED, did an investigation into the working conditions in the Tesla factory and found that although Tesla claims it brought down its injury rate significantly in 2017 to match the industry average, it was actually failing to report some serious injuries, allowing a better-than-reality injury rate to be reflected. Some serious injuries were labeled as only requiring First Aid whereas other work injuries were labeled as “personal medical” cases that wouldn’t be counted on Tesla’s injury report. In an article published a month later, Reveal found that Tesla added 13 injuries to its 2017 certified, legally mandated report despite emphasizing emphatically in the previous article that it was very confident in the injury rates reported and even stooping to accuse Reveal of being an “extremist organization” that was “creat[ing] a calculated disinformation campaign against Tesla.” Even more concerning is that all of those 13 injuries added were from the last few months of 2017 and Tesla hadn’t added any injuries from before September 2017. Why’s it so concerning? Because those injuries were added right after the California Occupational Safety and Health Administration opened an investigation into Tesla, and since the agency “can’t cite an employer more than six months after the injury should have been recorded,” Tesla only has to cover its tracks for the last few months, indicating with extremely high likelihood, that although there are injuries that should be added from the early months of 2017, Tesla won’t add them even though doing would more accurately reflect actual injury rates. This should dispel us of the notion that Tesla “records injuries accurately and cares deeply about the safety of its workers” (quote from Tesla in first Reveal article).

The safety issues and inaccurate injury reporting at Tesla stem directly from Musk’s lofty promises. The culture of a company is shaped by its leaders and since Musk has been Tesla’s CEO for almost 10 years and has been a key leader for even longer, he’s obviously had an enormous impact in creating the culture and hiring the type of managers that will preserve that culture. So, is it really a surprise that Musk, known for being a hard-driving taskmaster who pushes both himself and his employees to the limit, is in charge of a company that does the same? The onerous burdens thrust upon front-line employees and the inaccurate, possibly fraudulent, injury reporting are a byproduct of the Herculean goals Musk imposes on himself and his leaders, goals that are then cascaded down the org chart.

Moral Licensing

A recent Freakonomics episode talked about corporate social responsibility (CSR) and how firms that advertise a job see a 33% increase in application rates when they emphasize their CSR compared to when they don’t mention it; workers also supposedly work 10 to 25% harder when they believe in the company’s CSR compared to when they don’t, driven by women. The episode transcript didn’t link to those studies, so I wasn’t able to dig deeper, but the studies conform with my priors that firms with genuine CSR like Patagonia or Tesla will be able to attract more workers and will have better motivated workers. 90% of Global Fortune 250 companies publish annual CSR reports, but there’s a difference between companies like Pfizer and Coca-Cola (not sure if they publish CSR reports but just an example) that cynically publish CSR reports and companies like Patagonia and Tesla that live and breathe their corporate-social mission. So, my intuition is that even though a large majority of large corporations publish CSR reports, they won’t benefit from the two CSR effects mentioned earlier, but companies like Tesla will.

The Guardian reported a year ago of workers complaining about the same issues mentioned earlier, but even those workers expressed enthusiasm for Tesla’s world-changing mission. It’s clear that many of Tesla’s employees are motivated by its laudable mission and it’s no surprise that they’re willing to work diligently for the company. The Freaknomics episode mentioned earlier is actually centered around moral licensing, the effect that when we do good in one act, we become less concerned with doing bad in another; we use the good we did earlier to justify the bad. A basic example would be using your earlier 5-mile run to justify the pint of ice cream you’re about to inhale now. The study cited in the episode comes from List and Momeni. The study had over 3,000 participants from Mechanical Turk who were divided into 6 groups. The most conclusive result found was that an appeal to CSR made the workers more likely to cheat in their task; workers were not only more likely to cheat, but would also cheat with more intensity (though that finding is on less firm ground than the previous finding). Therefore, the workers on MTurk were using the appeal to CSR to justify the cheating in their work.

I propose that managers at Tesla are similarly using moral licensing to justify the subpar working conditions at the factory and inaccurate reporting of injury rates. The employees are so concerned with ensuring Tesla’s success and doing good in the world that they start to rationalize the corners they cut. The serious injury starts to look less serious. The on-the-job injury probably originated off the work. Temp workers don’t count as actual workers do they? Now, I could be wrong and the managers in charge of worker safety might have done a utilitarian calculation and found that it’s actually better for the world if they fudge the numbers a little, but I think it’s much more likely that the combination of pressure from their superiors and moral licensing convince them of their justification for the small cheating.

Hero Worship

This isn’t meant as a slight, and is honestly probably more of a compliment, but if there’s anyone that actually did the utilitarian calculus and decided it’s better for the world if the numbers are fudged a little, it’d be Elon Musk. I remember reading Ashlee Vance’s biography of Musk and being astonished by Musk: his first-principles, long-term thinking, his calculated risk-taking to do the things to benefit society that no one else will do, and above all his determination and grit in working as painstakingly as is needed to succeed. I admire him greatly, and I realize that what makes him so great and what causes the poor work conditions may originate from the same place. But, I don’t think my admiration of him and my criticism of things that he and his companies should rightly be criticized for are mutually exclusive. It makes logical sense to me that I can still admire Tesla as a company, but hope and want for it to do better in certain aspects. It’s such a cliché, but it’s important to remember that even the people you admire have flaws and to not be blind to those flaws. I also understand that Tesla is still in a precarious position as it keeps racking up unprofitable quarters and that there must be immense pressure on Musk, but I don’t think that, or his praiseworthy mission should detract from appropriate criticism. And, as a huge fan of his, I find Musk’s seeming inability to distinguish appropriate criticism from malicious vitriol to be disheartening.

Featured image from Flickr
Weekly Digest

Weekly Digest 5/24/18

Radiolab episode titled “More or Less Human” – The episode starts with audience members trying to distinguish a chatbot from a real person and then moves to toys with some emotions encoded. The Furby, for example, would cry for help when it was held upside down, and in an experiment, kids that held it upside down put it right-side up much faster than a Barbie doll, which they put right-side up only when their arm grew tired. The episode also talks about a disturbing video of people abusing a toy that had emotions programmed into it to fulfill sadistic desires or simply for amusement. And, it concludes by describing a virtual therapy session in which the patient and therapist are the same person. By understanding our interactions with technology infused with human behavior, we can understand more about ourselves. All of Radiolab’s episodes are fantastic but this one is a cut above the rest; must listen. (64 min.)

Alex Tabarrok and The Economist on paying for vs. donating blood plasma – They argue why blood plasma donors should be paid and point out how perverse it is to ban payment for plasma while at the same time importing plasma from the U.S. that came from paid donors. (600 words)

Ira Glass’s Commencement Speech at Columbia’s Journalism School – Creator of This American Life (TAL) Ira Glass talks about the many paths available in journalism and gives examples on how to create a moving, engrossing story using previous TAL episodes. (5,500 words)

New article by Richard Thaler – Thaler discusses many of behavioral economics’ key contributions including loss aversion, sunk costs, fairness principles, the endowment effect, nudging, and rejection of the efficient markets hypothesis. (10,600 words)

Russ Roberts interviews David Skarbek about prison gangs – Skarbek describes how prisons were completely different decades ago when the prison populations were smaller and when everyone knew each other’s reputations. Nowadays, however, the population is too large and Skarbek describes how a hierarchy has arisen among the prisoners to manage each other. (76 min.)

The Guardian on the biggest merger in the eyewear industry – The eyewear industry is dominated by two companies, Luxottica and Essilor, and they’re merging. The article digs into the history of the two companies and how they grew so dominant and talks about the possible consequences of the upcoming merger. (8,600 words)

 

Weekly Digest

Weekly Digest 5/17/18

Scott Alexander on basic income vs. basic jobs – Long read about why universal basic income is better than a basic jobs guarantee; UBI provides better incentives, less bureaucracy and helps those most in need. Must read.

Felix Salmon on the philanthropic mindset of many tech billionaires – I think Salmon’s generalization of tech billionaires is too facile but his article does raise interesting questions about philanthropy. Is it better to balance the playing field for the billions already living or to create the conditions so that many more billions can be born? Is it better to focus on moonshots or the incremental change?

Kelvin Stott on the pharma industry – Stott says that the return on investment has been declining for the past 20 years and will soon reach 0% due to diminishing returns. Furthermore, the industry will start to decline within a few years and will have to adapt to the new environment in order to survive. Not sure how to reconcile this article with all the articles about the pharma industry overcharging for drugs and making massive profits.

Bill Simmons interviewing Ethan Hawke – Skip the first 23 minutes if you’re not interested in hearing about sports. The interview goes into the Before Trilogy (best trilogy ever), being on the set with Denzel Washington, Ethan Hawke’s early career and more.

Weekly Digest

Weekly Digest 5/10/18

Scott Aaronson weighing in on the controversy caused by Robin Hanson’s article – Robin’s original post and follow-up. Scott notes that Robin has spawned many important, original ideas, and that though he can be tone-deaf or insensitive, he is a genuine person. Robin’s original post noted that there is liberal sympathy for people who lack access to money but not for those who lack access to sex, about as taboo of a comparison as is possible to make. But as Scott points out, Robin doesn’t hold your hand or slowly walk you through his ideas, which is why I prefer Scott’s article instead. He handles the topic much more delicately, and his article won’t invoke the involuntary feelings of disgust that Robin’s might. The biggest takeaway is that we don’t consider Muslim extremists as representative of all Muslims nor do we consider leftist extremists to be representatives of all leftists. So similarly, we should not consider extremist involuntary celibates as representatives of all involuntary celibates. And since we recognize that the majority of Muslims are normal, decent people, and feel compassion for their plight in combating discrimination, we should recognize that the majority of involuntary celibates are decent people as well and extend our compassion for their plight in finding human connection. No, I’m not saying you should feel compassion for the minority that sexually harasses the other sex (mostly women) or demand sex as a right, just like I wouldn’t expect you to feel compassion for Muslim extremists who terrorize the population. But do recognize that most are deserving of your compassion.

Scott Alexander’s classification of the levels of disagreement – The article provides a breakdown of the types of disagreement ranging from the uncharitable to the ideal. Scott notes how public discourse rarely gets above the lowest levels and provides guidelines for better debates.

Review of Ron Chernow’s biography of Grant – Blight praises the biography but pushes back on some of Chernow’s conclusions. Blight points out that we shouldn’t completely absolve Grant of all the corruption that was going on during his presidency. Grant is such a captivating figure and the way we interpret him will not only depend on his actions but also on the time period and the person doing the interpreting.

Megan McArdle on the difficulty of achieving the programs left-wing Americans dream of – “Notably, almost all the foreign programs that American social democrats envy were enacted during Europe’s long post-war economic and demographic boom. That meant that the initial cost of these systems was fairly low — young people don’t need much in the way of health care or pensions, and economies at full employment don’t spend a lot on unemployment insurance or job retraining. As incomes soared, it was comparatively easy for government to skim some of the surplus for their new social insurance schemes, because even as their taxes went up, workers still got to take more money home every week. Governments ran into problems when the boom stopped, of course, but by then, political sentiment had cemented those programs in place.”

William Broyles, Jr.’s essay Why Men Love War – Originally published in 1984, Broyles explains why men love war: self-discovery, brotherhood, the thrill of skirting death, and the intense love with others that develops when faced with constant danger.

Felix Salmon on Food for the Poor – The nonprofit inflates its revenues by using an overstated value for the donated goods it receives in order to appear more efficient than it actually is. And pharmaceutical companies might be reporting overstated donations using the same method.

“My Effing First Amendment” by This American Life – Podcast episode about an incident at the University of Nebraska – Lincoln about conservatives triggering liberals who then trigger the conservatives. There is no clear “good” side and you end up empathizing and getting angry at all the parties involved.