Brexit: Updated Scenario Probabilities

Ah well, time for a Brexit scenario update based on Bayesian re-assessment of which way the wind blows currently, and in ascending order of probability

1) Visible Hand 15% probable.
This is a friend’s predicted down to the wire outcome, in which sheer self-interest of the UK and EU forces a not too bad deal the UK can live with. Though it will be down to the wire nerve racking and like a game of poker bluff. Only requires cool nerves and no real creative negotiating skills. I think this improbable because bridging 27 countries interests will require real creativity and also because no free movement of labor is almost impossible to cut as a deal even with EU economic self interest. I define not too bad a deal as one that allows some economic growth through to 2025, far less than in the EU but some.

2) UK Stays in the EU 20% probable.
Clearly the best option in terms of UK interests and the one business wants and any sane analysis of UK interests would point to. I am being very out of character optimistic in assigning it 20% probability as I suspect it is less than this, but I guess this is my equivalent to my friend’s faith in Visible Hand: self interest will come through. This still leaves the pre-Brexit problems of poor UK productivity and uncompetitiveness, not to mention the EU’s own problems currently concealed by the short term and by the focus on Brexit, but the UK and EU issues are best addressed with the UK inside the EU. So UK resumes past economic growth trend or better with some hard work.

3) Mindful Hand: 30% probable.
Really skillful and creative negotiation actually does find a way to deliver the combo of the Single Market and immigration controls of say the 1.5 Norwichs level (down from 3 Norwichs a year currently: one of the more emotive Brexit arguments using this metaphor fyi) or at least some non-economy damaging equivalent. So again worse than staying in, but at least some economic growth possible. I would assign this a much higher probability, if the current Conservative leadership had shown the slightest sign of negotiating skill, were listening to their Civil Service advisors, and didn’t seem to be the stupidest Conservative leaders in my life time.

4) Wrecking Ball 35% probable.
This is Hard Brexit no deal, no real trading alternatives prove possible so the UK economy doesn’t grow at all through 2025 in real terms, inflation goes well above 3% and Corbyn has a good chance of winning the next general election, because the economy is tanking and he then makes things far worse. Now this scenario should be next to impossible, rather than the most probable, because it is frankly insane. And you would think any sort of self- interest would rule it out. But the Conservative Party for the first time in its history (our such luck) has stopped listening to business, to the City, to reality even, and instead is in thrall to the Lumpen Bourgeoisie and the Lumpen Proletariat and much of its active membership, who help elect their leaders and MPs, is committed to economic suicide, and some of its more malign leadership happy to run with this over the cliff, screw the country for career gain or ideological fantasy.

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Perfect Solution or Salami Slicing: Gun Deaths in the USA

 If one actually wanted to reduce the 33,000 gun deaths a year in the USA you would do what we would do in business with a big hairy problem: salami slice it into doable chunks. You would not assume you can make the 300 million guns go away any time soon. 

Go after the 20,000 gun suicides with a national suicide prevention drive for Veterans and non Veterans. Build Veteran mutual support networks and if that works try to do the same for other at risk demographics like ageing males. Experiment and see what works. Learn from states who do this, or other countries.

Go after the next biggest number: gang deaths by emulating the successful gang reduction programs in many cities and yes harassing the gang members out of carrying: lock up em if they do. Aim to get tens of thousands of guns out of gang hands and don’t use the bs criminals break laws: most police forces know who the gang members are and just stop and search known gun carriers and lock up. 5 years for unlicensed gun carrying. 10 for felon carrying.

Go after domestic violence with programs aimed at that: there are usually escalating signs before a domestic violence gun murder. And yes educate the population about and against this.

Go after police shootings: the racism and the lack of training. And so on.

And yes one slice is gun control: keeping guns out of the hands of felons and of the mentally unstable, erring on the safe side. And life long bans for those who use guns in crimes.

And yes for the mass shootings, go after the semi automatic rifles, big magazines and profile likely shooters who rarely come out of a clear blue sky…

And finally get really good research going: what are the real numbers, what are the causes and what works to stop the killing. Heck we have 1.5 million dead Americans since 1968 so not short of data if we analyze it honestly and rigorously as the NRA blocks happening because they likely know the answer the facts will deliver just like the Tobacco companies.

Or you can do nothing, until the perfect solution arises out of a GOP dominated Congress…

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Richard Thaler: How to Change Minds and Influence People

Powerful and insightful article from Tim Harford in the Financial Times:

 “The story of how a ‘lazy’ man won a Nobel Prize is as important as what he won it for. The Nobel laureate Richard Thaler’s central insight was that while economists theorised that people were as rational as Spock, their decisions around money were much more messy 

“The best thing about Thaler, what really makes him special, is that he is lazy.” So said Daniel Kahneman, winner in 2002 of the Nobel memorial prize in economics. Prof Kahneman was talking about Richard Thaler, who has emulated that achievement 15 years later. Prof Thaler’s thesis adviser, the economist Sherwin Rosen, put it differently: “We didn’t expect much of him.”

The story of how a lazy and unpromising man won a Nobel memorial prize is perhaps just as important as what he won the prize for. The Nobel announcement recognised Prof Thaler “for his contributions to behavioural economics”. But there’s another way to describe the way he reshaped economics: he persuaded a large group of successful people with a strongly held view of the world to change their minds. What was that view? To oversimplify, it was that all of us are Spock-like rational optimisers, able to instantly trade off risk and reward, rebalance a spending plan in the face of a price change, and resist temptations such as chocolate brownies or payday loans.

Of course, no economist has ever quite believed this. But for several decades most economists believed that departures from the world of Spock were small enough, rare enough and random enough that they could be ignored. Humans weren’t quite like Spock, yet when building economic models and formulating economic policies, we could treat them as if they were. This approach is not as absurd as it might seem. It’s flexible, powerful, and consistent. It is often close enough to reality to be useful. Prof Thaler himself told me: “If you want one unifying theory of economic behaviour, you won’t do better than the neoclassical model.”

Yet the power of the neoclassical approach made it hard to challenge. Prof Thaler wasn’t the first Nobel laureate to operate outside that paradigm — others include Maurice Allais, Herb Simon and Thomas Schelling. Yet all these men, while admired, did not manage to divert the mainstream of economic thought beyond the well-worn channel of rational optimisation.

It was Prof Thaler who shifted the norms of how economics is practised, both in academia and in the policy world. Behavioural economics is now respectable in places from the American Economic Review to the World Bank. Whether or not you think behavioural economics matters, as a feat of persuading people to change their minds this is a case worth studying. So how did he do it? We could all do with knowing, because the world is full of stubborn-minded people who need to be persuaded to change their views about important things.

Part of the story is simple persistence: Prof Thaler’s first behavioural economics paper was published in 1980; he has been banging this drum for a long time.

More important was that Prof Thaler fully understood what he was criticising. It is all too easy to attack those with whom we disagree based on the haziest idea of what they think and why they think it. But he grasped perfectly why his fellow economists embraced rationality, and the arguments (good and bad) they used to defend it. Prof Thaler engaged honestly and thoughtfully with the mainstream.

His third technique was to look at the facts — not only clever statistics, but everyday facts about human existence. We find snack food hard to resist. We divide up money into separate mental accounts — rainy-day money, an entertainment budget, money for food, money for clothes. If we find a fine old bottle of port in the attic, we might refuse to sell it for hundreds of pounds, even though we would not dream of spending a three figure sum on a bottle of anything. Having secured agreement on these facts, he then moved to arguing that they might matter.

Finally, Prof Thaler engaged people’s sense of curiosity. His long running series “Anomalies”, published in the widely-read scholarly Journal of Economic Perspectives, would often begin with a puzzle — some piece of behaviour or pattern in the data that simply didn’t make sense from the mainstream point of view. He would then explore the puzzle, extend it, and consider various possible solutions. Economists would talk about these anomalies in faculty coffee rooms. They would, at Prof Thaler’s invitation, send in their own suggestions. Rather than telling his opponents they were wrong, Prof Thaler would present a conundrum and invite everyone to discuss it together. One of his critics, the great Chicago economist Merton Miller, was reduced to complaining that Prof Thaler’s anomalies were a distraction from serious modelling because they were simply too interesting.

Which brings us back to his laziness. Prof Kahneman thought Prof Thaler’s laziness made him “special” because it meant that he could only be bothered to work on the most fascinating questions. Maybe. But perhaps the truth is that laziness isn’t special at all. Prof Thaler realised that most of us are lazy. Most of us don’t want to think hard about our beliefs, or challenges to them. His solution was to make sure those challenges were simply too intriguing to ignore. tim.harford@ft.com

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Other Approaches to the US Gun Death Epidemic

It is interesting that all sides in the gun death issue seem to want to fight it as a matter of huge irreconcilable principle and get nowhere.

And then when you suggest: oh let’s look at the UK with one of the lowest gun death rates in the world: people say you can’t compare etc.  And my favorite argument, not: “criminals will use guns illegally so no point in having laws on guns.” I never hear the gundamentalist GOP use that argument about abortions: “no point in making them illegal as people will have them anyway.”

Well, guns being hard to get legally in the UK largely seems to keep criminals from having guns, and if they get caught even carrying a gun illegally, or using a gun in a crime the law hits them very hard. We could at least make a violent felon having a gun a serious crime. Ditto someone who commits domestic violence that kills 1200 a year. Having the UK gun laws and thus the UK gun death rate would save about 28,000 American lives a year.

Now in reality that isn’t going to happen, but it is like food poisoning: saying some will happen anyway so why bother with hygiene precautions. The US states with the toughest gun laws have lower gun deaths. So we should go with what works. Keeping guns out of the hands of lunatics, gang members (and there are successful ways to do that in some cities) and also having a major drive on gun suicide prevention would save far more lives than the billions of $ we spend on securing us from foreign terrorism. This is a minute threat in comparison with 33,000 gun deaths a year, two thirds suicides. Statistically we should be far more afraid of guns than terrorists.

Contrast this lack of a good US approach on guns, not with the British approach to gun deaths as they have never had many nor have many guns, but to their approach to road deaths.

Basically the UK had something like the US road death rate per 100,000 and reduced it by 75%. They started by looking at the data big time and at other countries to see what worked. And then they went after DUI, motorcycle helmets, re-engineering any road stretch with a bad accident record, driver education, speed limits heavily enforced by cameras, and one I know about personally as a friend of mine invented it, a driving test that assesses how good drivers are at spotting risk using a video clip and they have to press a button at each hazard included in the clip.

Applying this to US roads would save 24,000 lives; applying it to US gun deaths maybe the same. But hey it’s much more fun to have the two sides club each other. And of course the Rights of Guns side have blocked most attempts by CDC and others to do the research needed to drive the solutions.

The approach of salami silencing: breaking a problem down into solvable parts is also helped by the Nate Silver stats here: https://fivethirtyeight.com/features/mass-shootings-are-a-bad-way-to-understand-gun-violence/

PS Anyone want to do any real work on this issue: this is the PWC account of the UK approach to reducing road deaths: the UK now has the second lowest road fatality rate in the world: 2.9 deaths per 100,000 compared to 10.9 in the US and 17.4 world average…The Brits must be doing something right: https://www.pwc.com/…/pwc-guide-on-reducing-road…

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Really Good Graphic Summary of Cognitive Biases

Every Single Cognitive Bias in One Infographic

The link is here if you want to read it more easily: http://www.visualcapitalist.com/wp-content/uploads/2017/09/cognitive-bias-infographic.html

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Strategy by Any Other Name Would Sound as Unacceptable

Someone asked me for some strategic thoughts on the current US political situation: 

I don’t think the Dems/progressives can do strategy. Not seen any sign of it these recent decades. My strategic views are not very popular, don’t get many likes on FB. 🙂 I read Lawrence Freedman’s huge book Strategy: A History last year to get insights from every aspect of strategy, military, psychology, business, game theory, philosophy and political history etc.

Wikipedia: Strategy (from Greek στρατηγία stratēgia, “art of troop leader; office of general, command, generalship”[1]) is a high level plan to achieve one or more goals under conditions of uncertainty. In the sense of the “art of the general”, which included several subsets of skills including “tactics”, siegecraft, logistics etc., the term came into use in the 6th century C.E. in East Roman terminology, and was translated into Western vernacular languages only in the 18th century. From then until the 20th century, the word “strategy” came to denote “a comprehensive way to try to pursue political ends, including the threat or actual use of force, in a dialectic of wills” in a military conflict, in which both adversaries interact.

Strategy currently would involve:
1) having a general plan to address the key issues systemically: aka joined up thinking

2) for me that has to include the fundamentals of how the economy is run as context for everything else: politics is economics and economics politics

3) the Dems don’t have that, haven’t had an original idea in that area for decades

4) without that politics hangs loose in the air

5) strategy also means that each time you act you already have figured out the likely reaction of the enemy to your action and included that in the plan and your reaction to their reaction…and so on

6) aka you reaction proof the plan

7) or as Mike Tyson put it strategy rarely survives a punch in the mouth

8) Trump will in due course cut taxes and make the deficit soar, cause the economy to race short term and no one will care about much else. Strategy would be to expect that and already have framed a response.

9) Down the road automation will hit and increase inequality still further and the Dems have no strategy for that either. So ditto.

10) Mao was probably right and you have to make the intellectuals go work in the fields or in factories, then they might get strategic.

11) And strategically I would have gone for Poor Lives Matter, as a way to reaction proof the action. Not because I think Black Lives Matter is not morally totally on target and in my heart I fully support it; but because Trump used it in the election against itself, ju jitsued it into White Lives Don’t Matter. Just as you describe him doing to the kneeling protests. But this line will get me brickbats. 🙂

12) I would have from the start frame the kneeling protests as respecting the flag but mourning the dead and the rank injustice. Strategically.

OK that’s my blog. Not exactly encouraging is it? 🙂 And I didn’t reaction proof it either…and no one much reads what I actually say, but react to what I don’t say, so I am already doing a bit of reaction proofing just to illustrate my point. Tricksy aren’t I.

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Building on Jonathan Haidt’s The Righteous Mind

I was knocked out by the approach Jon Haidt developed in this book “The Righteous Mind: Why Good People are Divided by Politics and Religion”. Among other things it provided me with some really important and prescient insights into the support Donald Trump garnered to win the US Presidency. (Note: I was one of the people fortunate enough to read it in manuscript and contribute some comments to the author before recent political developments.) But I have now come to use the approach Jon has constructed to build on and move beyond its insights to different ones that I think may be of help in our new current political situation.

My first point of departure is a meta one. Jon makes a strong case that our rational brain (what he calls our Rider) is essentially what he calls Glauconian. Our often unconscious moral auto pilot (what he calls our Elephant) jumps to our conclusions and we use our rational brain, our Rider, not to interrogate our conclusions, to test their validity, but to defend them rather like a defense attorney. As he says, this makes some evolutionary sense as a means to ensure our social credibility in say a hunter-gatherer group. And certainly we have all observed this in others and if we look closely in ourselves. But Jon seems pessimistic that we can transcend it, even when we become aware of it. I am not.

Specifically, Jon’s own book shows him in fine Non-Glauconian mode. He was a liberally inclined social psychologist, yet exposure to the novel cultures of Brazil and India opened his eyes to a whole range of moral foundations missing from his previous world view. He did not attempt to rationalize this new data out of existence, but like a good Bayesian observer, changed his mind. Very un-Glauconian that…

Whether Glauconianism makes sense in complex modern society is also doubtful. Businesses that jumped to particular commercial strategies and then defended them in the face of plummeting sales would not survive. Flawed military strategies that were defended in a Glauconian fashion in the light of battlefield defeats would destroy the army using them. And indeed even in our personal lives, we have I would suggest little time for the bar room bores who drone on in defense of their bigotry, who never give an inch or concede they are mistaken. Try driving on the roads with a Glauconian mindset: ER here you come….And in my life in Labor Relations, Glauconianism would have lasted about five minutes: reality bites as do other people with power and a different take on the world, whether they are Glauconian or not….deals have to be made to survive.

So empirically I rather doubt we are wholly like this, unable to transcend our Glauconianism. Though clearly he usefully describes a tendency we all sometimes exhibit. And of course, as with many such philosophical stances, it is hard to apply it to Jon’s own thought without undermining it. Is his is own advocacy of Glauconian stances, Glauconian: a jumped to conclusion, which his rational mind defends despite the weakness of the description of reality? I don’t think so for the reasons I gave above: he changed his mind. And indeed as someone who has changed his own political and religious beliefs over time quite dramatically, I am not Glauconian either. And this brief essay is not the rationalizing of my existing jumped to beliefs, but an open minded exploration of Jon Haidt’s thinking that may be mistaken.

So I now use Jon’s approach as a push back on any tendency I have to defend the indefensible, and to use empirical data to this end, to be a strong Bayesian observer and allow counter data to overturn my stances. So I use his profound and useful insight heuristically to do better. Though I guess I have always been a bit this way….and I am far from perfect in this approach. Don’t get me started on climate change denial….

I then look at Jon’s original Five Bi-Polar Moral Foundations: Care/Harm, Fairness/Cheating, Loyalty/Betrayal, Authority/Subversion, and Sanctity/Degradation. He sees them as something where conservatives cover the bases rather better than liberals who focus most on Care/Harm and Fairness/Cheating. I am not so sure.

I think he populates his Foundations with a rather narrow data set perhaps overly based on American East Coast liberals, to somewhat overstate my case. Coming from Europe, the Left is far more communitarian, even collectivist, than US liberalism. And, for instance, the auto workers I spent most of my career with, have a very strong sense of Loyalty/Betrayal they call Solidarity. Their sense of Sanctity/Degradation includes disgust at lack of Solidarity and their collective will involves having leaders with Authority whom they follow into disputes and strikes. So in many ways I think Jon’s population is somewhat skewed and lacking a full global sample of progressive Moral Foundations. I grew up in what was then an intensely religious, intensely unionized, very left wing Welsh coal mining area, and my personal feelings on this no doubt reflect that background.

I also think it fails to capture the environmental movement, which strikes me as strong on Loyalty/Betrayal in relation to the planet, which it tends to hold as sacred i.e. has a strong sense of Sanctity. It is also strong on the Authority of science to make judgments on what is good for the environment. I don’t think it helpful to limit and populate these foundations with US conservative content (to see the love of Flag as something sacred but not love of the planet) when there are clearly other contents that don’t fit conservatism, but are still grounded in the same wider Moral Foundations Jon uncovered. I also wonder if he is missing a Moral Foundation around attachment to Empirical Truth/Beliefs: something that the environmental movement is strong on, yet conservative climate change deniers for instance are lacking.

But I also struggle with another angle. One test of any moral foundation is, in the light of 20th century history, is how does it work for the Nazis? They were strong on Care/Harm and Fairness/Cheating though they limited it to the Master Race. They were over the top on Loyalty/Betrayal: that was their core stück so to speak, as was Authority/Subversion. And their genocidal policies were all about purity and the Sanctity/Degradation axis. So I struggle to know on which Moral Foundation could they be indicted? Though you could add Jon’s sixth Moral Foundation and hit them on Liberty/Oppression I guess. And in many ways they were extreme conservative nationalists, very tribal and in-group and wrapping all their moral foundations around this and wanting to annihilate other tribes, which they often tried to do: Poles, Jews, Russians, and Serbians etc. So the position along the various Moral Foundations and the combo sandwich that is made out of them matters too?

I think more recently, the so called Alt Right in the US do something similar: erect White Supremacist tribalism and Loyalty to it as the core moral value. Make Care and Fairness only relate to this moral tribe and not relate to any others. Consider as disgusting (Degradation) any deviation from it and any resistance to it as Subversion. Hence President Trump’s stance on these dimensions too. And Liberty is for this moral tribe to do what it wants to other tribes?

So ultimately, I now tend to use the insights of Jon’s Moral Foundations in a somewhat radical way. I try to overcome our tendency towards Glauconian self-serving rationality and replace it with more robust Bayesian self- and my-side-challenging dialogue. And I leverage his Moral Foundations to challenge the progressive Left to grow solidarity as a form of Loyalty. I drive towards using the Authority of science to establish sane policies. And I share the environmental movement’s sense of the Sanctity of the planet and our Loyalty to this sanctity. Rather than focus on burning the flag, I focus on the burning of the planet so to speak. And in many ways, I see Liberty/Oppression is a strong distinguishing feature that separates fascism from traditional conservatism, though I suppose one could have a Moral Foundation around Genocide/Global Empathy or some such? And ultimately I would suggest a dominant Moral Foundation against which all other Moral Foundations should be tested: does the Moral Foundation support the survival of humanity and the planet as a viable place to live?

But then I may be mistaken….

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