Wednesday, October 27, 2010

As the Sun Sets Lazily Over the Jersey Shore....

I can be a hard person to be around watching a movie because I love to jump on goofs. Some of the most infamous goofs are things like showing the characters sitting on a beach watching the sun set....over the Atlantic ocean. In that regard, it would be hard to find a worse headline than a recent article in the Tallahassee Democrat. (Yes, I know, you're wondering what it's like to live in a town where that's the name of the local paper, but I digress).

"Park it: Rate increase has no effect on demand."

That headline is about the City of Tallahassee raising rates on traffic meters from 25 cents per hour to 50 cents per hour. If doubling the price of parking had "no effect on demand" then revenue, which is 25*x cents (where x is the amount of parking), should double to 50*x cents. And yet, the revenue estimates from the meters are $270,157 before the increase and $275,000 after the increase. Ignoring the slight offset between the fiscal year date and the revenue reporting date, if the price per park has gone from 25 cents to 50 cents an hour, doesn't that suggest that the number of hours parked has dropped from 1,080,628 to 550,000? That's a pretty big hit on demand. And, the switchover being in late 2009 suggests that the drop probably isn't related to the recession. In fact, the text of the article even quotes city officials as saying that one of the effects of the price increase has been to shift parking from the metered spots to the downtown parking garages. (I checked with my nephew Nick Heynen who works at the Madison, Wisconsin, newspaper and he told me that it is still the case that the reporter who writes the story may not write the headline for the story).

This is Econ 101. A monopolist (the city) cannot raise prices without limit because at some point the effect from the lost demand outweighs the increase in the per-unit price. It's called the monopolist's demand elasticity. Some government monopolies have found that they've raised rates (or taxes) so much that their revenue has actually gone down. In Tallahassee, it appears that the fee increase had a big effect on demand, with the result that it had little effect on city revenue.

Tuesday, October 19, 2010

After Further Review, The Ruling on the Field is Overturned

This article provides incontrovertible evidence that the minimum wage can lead to job destruction. In this case, the, "review in the booth" affected only some American territories. How long will it be before we get to analyze the destructive effects on all of the United States of raising the minimum wage in the midst of a severe recession?

Saturday, October 16, 2010

Suppose Three Professors Were Working on A Railroad Track....

This is one of those references I will make with only a little comment. In today's Wall Street Journal, Peter Berkowitz of the Hoover Institution at Stanford wrote about why academics seem to be so out of touch with Main Street. He writes, in part:

"Neither professors of political science nor of history have made a priority of instructing students in the founding principles of American constitutional government. Nor have they taught about the contest between the progressive vision and the conservative vision that has characterized American politics since Woodrow Wilson (then a political scientist at Princeton) helped launch the progressive movement in the late 19th century by arguing that the Constitution had become obsolete and hindered democratic reform.

Then there are the proliferating classes in practical ethics and moral reasoning. These expose students to hypothetical conundrums involving individuals in surreal circumstances suddenly facing life and death decisions.... Such exercises may sharpen students' ability to argue. They do little to teach about self-government."

Friday, October 15, 2010

The Wisdom of Objectives

Lately a variety of interactions from reading the newspaper to offering advice about a friends future plans have led me to a simple piece of wisdom: Consider your objectives. If a person can identify their objective they can easily build a plan of action towards that goal.

For example, the City of Tallahassee is currently discussing peak and off-peak pricing of utilities. There are serious questions about their objectives. What will the peak and off-peak pricing accomplish? Traditionally peak and off-peak pricing have been utilized to reduce the strain on the power generators, which is more wasteful in terms of energy production when it needs to ramp up so quickly . .  . like when everybody flips the light switch at hom following the 5 o'clock rush hour. However, the pilot program the city is considering would be applicable to the first 2,000 residents to sign up. The likely outcome? People who will benefit from leaving the flat $.12 per kw/hr for the $.08 (7pm-7am) and $.22 (7am-7pm) rate structure will be the people who sign up. Will this reduce energy consumption by those households during peak hours? Probably not since most of them would say, "I don't use energy during that time anyway!"

Either the City of Tallahassee utilities has a different objective than I'm considering. For example, after the pilot they could use the data to convince people of the likely saving they would receive. But, in terms of strain on the power generator I'm not convinced this is going to have the impact you would get from a randomized pilot (is that legal?). In any case, I would need data to make such a claim about Talgov not seeing a change in energy usage from the pilot program.

Monday, October 4, 2010

My Phantom, It's Sir Charles God, the Notorious Litton*

In a recent issue, First Things magazine ran an article by Ron Rosenbaum that discussed moral sense and evil. The focus was on sociopaths, serial killers, Hitler, Mao, Stalin, and the like. The central question seemed to be whether or not a person who was a true sociopath could be consider to be evil if he had no conception that what he was doing was wrong.

I enjoyed reading the article but I found the discussion somewhat confusing because the question drifted from the one above to one more like "Do I commit evil if I think I am doing good?" I believe that this is a distinct question. Genesis says that mankind obtained a sense of the difference of good and evil by disobeying God and eating of the fruit of the tree of the knowledge of goodness and evil. If there indeed is such a thing as a sociopath who can not process any concept of good and evil (either in his own thoughts or in reference to society's norms) then such a person has a remarkable cognitive mutation that sets him apart from the normal model of humanity described in Genesis. (I'm not an expert on the topic of whether such people do or don't exist). But, it's an entirely different matter to talk about doing evil because we convince ourselves that what we are doing is moral and right. Indeed, this self-rationalization is all too human.

When we ate of the fruit of the tree of the knowledge of good and evil, we disobeyed God and sin came into humanity. No part of our being is separated from that sinfulness, not even our post-Fall sense of goodness and evil. Thus while we all (perhaps except sociopaths) have a moral sensibility, that sensibility is not God's; it is our own and it is corrupted. Certainly people sometime make choices that they are aware (correctly) are or may be morally suspect. Dietrich Bonhoeffer wrestled with this very clearly when he decided to join the murder plot against Adolf Hitler. But, how many more times do we sin when (because?) we have convinced ourselves that we have the moral high ground? We see that Jesus knew that addressing this self-rationalization was part of his message of salvation: Yes, you believe that your brother has wronged you. Forgive him anyway. Or, as interpreted by Paul: Yes, this other person has wronged you not once but many times. Don't keep track of those wrongs. Sometimes it will the case that the other guy HAS wronged me; maybe in other cases it is self-deception. But it is all a warning that it is God, not we, who knows the true measure of good and evil.

The paradox of this is that our moral sense may be imperfect when compared to God, but it is not nothing. Most of us are not sociopaths, nor do we live in the amoral surroundings of the kill or be-killed struggle for survival in the animal kingdom. But I believe that among the actions of the Holy Spirit are: 1) Changing our utility function (what we want to do), and 2 ) refining our moral sense to give us a better idea of what God things is right and wrong. Maybe these are the same thing, but I think that they may be different.

In the year in which Inception became such a big hit, I realized in all the media discussions that I have a strong tendency to what is called lucid dreaming. I tend to remember many of my dreams, and when I wake up and I realize I've been dreaming I can sometimes decide whether to rejoin that dream as I go back to sleep. Last night, perhaps because I was thinking about writing this post, I had the strangest continuing dream in which I was an international forger of rare documents, on the run from INTERPOL. What the authorities didn't know was that I enjoyed the chase for for its own sake, and after I pulled off the forgery job, I always returned the originals, so I never profited directly and there would never be any evidence to stand up in court. In reality I don't even draw well, much less have any conscious desire to forge rare documents. I don't even know what documents would be rare, and I think I would enjoy being a fugitive from INETRPOL less than almost anyone I know. What this dream made me think about is this jumble of what we are capable of doing, what we may be inclined to do, and how this interacts with our imperfect sense of right and wrong. This is why the Bible tells us that we are different than other animals, and why the Bible is a story that tells us how God wants this strange interplay to turn out in the end.

*Today's title reference is to that famous movie villain who enjoyed the thrill of being chased by the bumbling Inspector Clouseau: Sir Charles Litton, the notorious Phantom of the Pink Panther series.