I've said this before, but

Part of the reason I don’t really post that often is because I feel I’ve said what I need to say on the subject before. That happened twice today. The first is a couple of comments I left at Levitt’s blog. The second is this comment I am leaving at TalkLeft about how to solve the heroin problem in Afghanistan. This one is short enough to repost in its entirety from Slate. Originally written 5-18-04.

We need to legalize heroin in Afghanistan

I was watching Dave Barno's talk (audio available at the csis site) about how poor the security situation is in Afghanistan and how little reconstructive work has been done (the ring road is the only serviceable road in the country) when it became clear how much of the mission in Afghanistan is preoccupied by interdiction of the opium trade. If you listen to the audio, you'll see how he emphasizes this factor as consuming a large part of the resources in that theater, apparently including his own attention.

This is a phenomenal waste. The degradation of governmental legitimacy that results from prohibition is having harsh real world effects in Afghanistan. This isn't just about letting a few people get high, it is a matter of life and death. Because the western occupation forces in Afghanistan are actively attempting to destroy its most profitable (and only) export, they are receiving very little cooperation from the populace.

If we allow the gangsters of Afghanistan to organize and profit off of the opium trade, we create a source of power that is alternative to the central government. Large western powers have periodically entered and left the life of most Afghanis while heroin gangsters have been a perpetual presence. If we force the Afghanis to choose between the two, the smart money will be on the gangsters.

The Big Idea

Plumber wants to know why wealth inequaltiy hurts GDP growth.

Abstract: If risks increase societal wealth, and people care about relative position, then when people are far apart on wealth, they will not risk as much because they won’t be able to change their social position higher and are also not afraid of having their position lowered.

Inequality represents our relative positions in society. Paris Hilton probably does not have a whole lot of better chance at survival to reproduction then Brad Plumber (and in fact may have less due to drug use and promiscuity), but she has access to many times his wealth (presumably). In theory, if she were fall ill to some obscure disease, she may be able to accelerate research in that disease somewhat, but outside of this obscure chance, there is little that her wealth can create something to personally benefit herself. Her wealth can signal that she is near the core of society. This is of advantage because the aggregate probability that humanity will survive fluctuates, as in the case of, say, the Black Death. If a world wide epidemic were to occur, Paris Hilton, or her eventual heirs will be holed up in her villa outside Naples telling sexually titillating stories to her other obscenely rich friends.

So being at the core of society will increase your chance of survival in a somewhat zero sum manner. A successful society organizes itself so that the people who increase the probability of survival for the whole society are also the people who are closest to the core of society.

People wish to maximize the survival of their genes. Maybe it would be more accurate to say that genes wish to maximize their survival (yes, I believe genes can be analyzed as quasi rational agents), and people are for the most part at the mercy of their genes.

Presume there are two distinct goods, wealth and looks. Wealth reflects a non-zero sum good that is proxy for absolute survival (survival without regard to human behavior), looks reflect a zero sum good that may improve societal standing. Suppose further that some individuals specializes in one good, and the others specializes in the other good.

If people are at approximately equal wealth and society is organized to make good bets in wealth, i.e. blowing up your neighbor’s factory is not rewarded by society (by making your factory more valuable, say), then people will invest liberally. Even if you do not expect to benefit a significant amount from an increase in your own personal chance of survival by increasing your wealth, you will attract a mate that increases your gene’s chances of survival by a significant quantum if you increase your wealth a little over your neighbor’s level. So if you take a risk by investing, you have a better chance of leapfrogging your neighbor and landing the high “looks” mate. Seeing that you are investing, they may wish to counter invest to increase their chances of getting the high “looks” mate. To which you may counter, and etcetera.

On the other hand, if there is a significant wealth disparity, the high wealth individual will not feel any threat to their social position even if the poor individual increases their wealth. The poor individual also will see that the raw increase in chance of survival from increasing their wealth good will not outweigh the costs if their investment does not turn out, and that they have little chance of leapfrogging the high wealth individual and mate get the high “looks” mate.

How arson is like WMD

In my day job as an economist I had reason to look into the colonial history of slavery in the northern US, and forty one minutes ago I realized that the incident of the 1741 New York slave insurrection proves false the notion that we are in a situation unique in history in that an individual may inflict great harm on a mass of people through a biological or radiological weapon.

For the impatient, the 1741 New York slave insurrection was a series of arsons that occurred while slavery was still legal in that colony. Like a biological weapon, fire only needs an initial spark to possibly destroy whole cities in times before plumbing. Like today, the possibility of widespread destruction caused by a single individual created a hateful rabid frenzy in desperate need of a witch hunt to quench its blood lust, resulting in a series of kangaroo court convictions of brown people and persecution of local intellectuals and non-conformists as well as a general crack down on the individual rights (of the poor, see below). Since this was a case of a short string of arsons, it is unlikely that there was any actual conspiracy, or that there was more then one person involved. The only evidence of an organization is the coerced testimony of the victims of the witch hunt.

An autogyro in every hangar?

Battlepanda, Delong and Matt Yglesias all discuss this NYT article about the growing inequality and what the Times writer calls decreasing appearance of class.

What all miss is that the metric of class is the degree of independence from the larger society that individuals are allowed. Looking back at the Gilded Age / Edwardian period, few inventions were not widely available shortly after becoming baubles of the rich. Electrification and telephone networks were initially available in urban centers and available to wide swaths of society, much like today’s cellular and high speed internet networks. However, you would be about as likely to get electrification or long distance telephone service in Ogallala Nebraska in 1905 as Mike Jones would be likely to be able to text message from his T-Mobile Sidekick™ or download his album over high speed lines in 2005. You would be able to buy a Victorola for $15-$300, or about $300-$6,000 in 2005. In addition, like today, luxuries were widely available in smaller quantities. While the rich would have a private fireworks display, performance by musicians or actors, or displays of novelties such as quack science or motion pictures, the public could enjoy similar experiences in public displays or by renting the experience, as in the case of the selling of individual photo portraits, plays on a juke box record player, or purchasing tonics to participate in the latest quack medicine fad.

This difference was especially notable in transportation, where the ability to afford a team of animals to pull a coach for only one person or perhaps a family could be approximate to the ability to afford a private jet or helicopter in 2005. While a middle class individual could possibly afford to rent such a conveyance, he could not afford to purchase for personal use. Before the socio-economic leveling that was the result of WWII, autos were definitely the playthings of the wealthy and not the means of commute for factory workers. There was nothing preventing a worker from buying a house with a yard instead of row house ten feet from the street except that to do so would require moving too far from the rail lines that take him to work. (So maybe the next step is an autogyro in every hangar?)

The bottom line is that the rich did not have any really exclusive experiences except scale, but because of that scale, the rich were able to construct a bubble around themselves, a sort of alternate society where they could live free of the restrictions that were increasingly necessary to impose on the rest of society due to the growing resource consumption of the top. While the Edwardians were busy nailing actresses behind the backs of the Victorian morals enforcers, the common people could not afford such indiscretions. While the Gilded isolated themselves from the rest of society, social ills like police corruption and environmental pollution became the problems exclusively of the poor as the rich could isolate themselves with private security and better transportation (to the country estate). Looking at the situation on the Isle of Manhattan, where a person educated on the luxurious consumption of wine can make more then a middle class family in Philadelphia, it seems a new bubble has formed. Indeed, is it more likely that video tape duster is able to enjoy a few “bowls” without fearing a piss test or the “Chet” that does the I-Banking for Blockbuster? Is it more likely that you, dear reader, or Paris Hilton, a nubile young female whose nakedness has already been exposed to the world on several of the internets, will suffer the indignities of a strip search in the name of Fatherland Homeland security on a trip from the East Coast to the West Coast?

This is not to say that there is a hard and fast line. There is a sliding scale from less police harassment and better schools to walking around the metal detectors. Does this imply that there are no class distinctions? Maybe. But it certainly suggests that income inequality is problematic even if there do not exists rigid discreet segments of society with widely divergent experiences.

The Evolution of Religion and Why Being Religious is (Usually) Hard

Brad Plumer wonders how strict religions survive.

To understand religions, we must understand the evolution of a religion. Every religion begins as an attempt to rearrange the social order, and thus must involve some quasi-anti-materialist quality since the materially plentiful rarely need to upset the social order. However, most successful religions have origins that can be interpreted as a liberalization of the existing religious practices for broader audiences and/or convenience.

After a religion has become relatively established, gradually more and more strict interpretation of the set of norms and mores is driven by attempt to maximize individuals’ own access to the resources of the society defined by the religion through display of piety. Since pleasurable displays of faith are easier to replicate, more difficult displays of faith are necessary in the tournament competition to be considered pious. In other words: Since not everybody can be “pious” (and thus entitled to the various societal rewards of that designation), but everybody can feast in celebration, it will take more then stuffing your face to be designated as pious. So the religion escalates in a war of masochistic piety over the resources of the religion, possibly fracturing, until the people get fed up and have a new reform movement.

I was going to write a long post about how this paradigm applies to Judaism, the split of Rabbinic off of the Tzedukim (Sadducee) tradition; Saul’s Christianity, the eventual calcification of the Roman branch and reform; Confucianism, Buddhism, and Marxianity, but I’ll leave that as an exercise for the reader.

Why the economy grows faster under Democrats

Calpundit brings up the fact that the economy does better under democrats. I have argued before that this phenomena is mostly due to republican policies being more popular during the peak of a business cycle and democrats being more popular at the nadir. The most straight forward examples of this are FDR, Clinton and Bush Jr.

Preznit Dubya, the Lionheart

Dubya: An over-mothered, incompetent and weak ruler that had a youth as an irresponsible partier whose conversion to religious fundamentalism functions both as a counter balance to his father’s conflict with religious conservatives and cover for his own past misdeeds, develops an inferiority complex to his over achieving father which he has opportunity to quench when, by happenstance, Islamic aggression gives him an excuse to simultaneously distract the masses and impress a bunch of insulated Jewish intellectuals through invasion of the Middle East, saddling his populace with the incurred debt.

Richard I: An over-mothered, incompetent and weak ruler that had a youth as an irresponsible pillager whose conversion to religious fundamentalism functions both as a counter balance to his father’s conflict with religious conservatives and cover for his own past misdeeds, develops an inferiority complex to his over achieving father which he has opportunity to quench when, by happenstance, Islamic aggression gives him an excuse to simultaneously distract the masses and impress a bunch of insulated French intellectuals through invasion of the Middle East, saddling his populace with the incurred debt.