Staying Rich Without Manufacturing Will Be Hard – Bloomberg View

Exchanging cheap U.S. crops for expensive foreign cars and computers doesn’t look like a winning trade.

In the 1990s, it really was true that manufacturing production was booming even though employment in the sector was falling.

But this piece of conventional wisdom is now outdated.

Bloomberg View

What’s more, the overall numbers hide serious declines in most areas of manufacturing. A 2013 paper by Susan Houseman, Timothy Bartik and Timothy Sturgeon found that strong growth in computer-related manufacturing obscured a decline in almost all other areas.

the U.S. to this day runs a trade surplus in agriculture even as it runs a huge deficit in manufactured products. … U.S. manufacturing is hurting in ways that U.S. agriculture never did.

If a country makes complex products that are linked to many other industries — such as computers, cars and chemicals — it will be rich. But if it makes simple products that don’t have much of a supply chain — soybeans or oil — it will stay poor.

Source: Staying Rich Without Manufacturing Will Be Hard – Bloomberg View

Corporations in the Age of Inequality

Inequality isn’t just about individuals — it’s risen between companies, too.

I believe that much of the rise of between-firm inequality, and therefore inequality in general, can be attributed to three factors: the rise of outsourcing, the adoption of IT, and the cumulative effects of winner-take-most competition.

What is clear is that over the past 35 years, firms have divided between winners and losers, and between those that rely heavily on knowledge workers and those that don’t. Employees inside winning companies enjoy rising incomes and interesting cognitive challenges. Workers outside this charmed circle experience something quite different. For example, contract janitors no longer receive the benefits or pay premium tied to a job at a big company. Their wages have been squeezed as their employers routinely bid to retain outsourcing contracts, a process ensuring that labor costs remain low or go ever lower. Their earnings have also come under pressure as the pool of less-skilled job seekers has expanded, due to automation, trade, and the Great Recession. In the process, work has begun to mirror neighborhoods — sharply segregated along economic and educational lines.

Source: Corporations in the Age of Inequality |

1m:44s tl;dr Video: Corporations in the Age of Inequality

Scientists made a detailed “roadmap” for meeting the Paris climate goals. It’s eye-opening. – Vox

Few people appreciate what it’d mean to take our climate goals seriously.

To hit the Paris climate goals without geoengineering, the world has to do three broad (and incredibly ambitious) things:

1) Global CO2 emissions from energy and industry have to fall in half each decade. That is, in the 2020s, the world cuts emissions in half. Then we do it again in the 2030s. Then we do it again in the 2040s.

2) Net emissions from land use — i.e., from agriculture and deforestation — have to fall steadily to zero by 2050. This would need to happen even as the world population grows and we’re feeding ever more people.

3) Technologies to suck carbon dioxide out of the atmosphere have to start scaling up massively, until we’re artificially pulling 5 gigatons of CO2 per year out of the atmosphere by 2050 — nearly double what all the world’s trees and soils already do.

2020-2030: … carbon pricing would expand to cover most aspects of the global economy, averaging around $50 per ton and rising. Coal power is phased out in rich countries by the end of the decade and is declining sharply elsewhere. … Wealthy countries no longer sell new combustion engine cars by 2030, and transportation gets widely electrified, with many short-haul flights replaced by rail. … In addition, spending on clean energy research increases by “an order of magnitude” this decade … By 2030, we’d need to be removing 100 to 500 megatons of CO2 each year and have a sense of how to scale up.

None of this is easy. It might well prove impossible. But this is roughly what staying well below 2°C entails

Source: Scientists made a detailed “roadmap” for meeting the Paris climate goals. It’s eye-opening. – Vox

What to do…

Trumpism will expand its base of believers and practitioners if it is not strenuously opposed, just like Nazism, Communism, Capitalism, Liberalism, and every other -ism. Trumpism is an idea. Ideas can only be defeated through the greater popularity of a competing, alternative idea.

Ideas have currency because of the moral values which underlie their motive, reasoning, logic, and their intent. Ideas can also sometimes have currency due to the experienced reality of the outcomes of actions based on them, but that comes later (it takes time) and is frequently overlooked through selective perception and/or other cognitive biases.

Still, there are concrete steps which can be taken and are not token echo chamber participation.

Continue reading What to do…

Guided By The Beauty Of Our Weapons | Slate Star Codex

Imagine a classroom where everyone believes they’re the teacher and everyone else is students. They all fight each other for space at the blackboard, give lectures that nobody listens to, assign homework that nobody does. When everyone gets abysmal test scores, one of the teachers has an idea: I need a more engaging curriculum. Sure. That’ll help.

I’ve changed my mind on various things during my life, and it was never a single moment that did it. It was more of a series of different things, each taking me a fraction of the way.

Given all of this, I reject the argument that Purely Logical Debate has been tried and found wanting. Like GK Chesterton, I think it has been found difficult and left untried.

Therapy might change minds, and so might friendly debate among equals, but neither of them scales very well.

The media already spends a lot of effort recommending good behavior. What if they tried modeling it?

Logical debate has one advantage over narrative, rhetoric, and violence: it’s an asymmetric weapon. That is, it’s a weapon which is stronger in the hands of the good guys than in the hands of the bad guys. … The whole point of logic is that, when done right, it can only prove things that are true. … Unless you use asymmetric weapons, the best you can hope for is to win by coincidence.

You are not completely immune to facts and logic. But you have been wrong about things before. You may be a bit smarter than the people on the other side. You may even be a lot smarter. But fundamentally their problems are your problems, and the same kind of logic that convinced you can convince them. It’s just going to be a long slog. You didn’t develop your opinions after a five-minute shouting match. You developed them after years of education and acculturation and engaging with hundreds of books and hundreds of people. Why should they be any different?

The problem is that Truth is a weak signal.

There is no shortcut.

Source: Guided By The Beauty Of Our Weapons | Slate Star Codex

Research Debt

Programmers talk about technical debt: there are ways to write software that are faster in the short run but problematic in the long run. Managers talk about institutional debt: institutions can grow quickly at the cost of bad practices creeping in. Both are easy to accumulate but hard to get rid of. Research can also have debt.

The insidious thing about research debt is that it’s normal. Everyone takes it for granted, and doesn’t realize that things could be different.

Source: Research Debt

What makes gambling wrong but insurance right? – BBC News

Gamblers and insurers both place bets on the future, so how do they compare?

Legally and culturally, there is a clear distinction between gambling and insurance. Economically the difference is less visible. Both gambler and insurer agree that money will change hands depending on what transpires in some unknowable future.

Risk-sharing mutual aid societies are now among the largest and best-funded organisations on the planet – we call them “governments”.

Source: What makes gambling wrong but insurance right? – BBC News

The position of the risk takers and the potential outcomes of the bet are what matter and differentiate the two. Insurance serves to share reduced risk whereas gambling serves to increase it.

The reason this matters is because there is a discontinuity in outcomes when the loser loses so much that they are unable to pay their debts (financial, contractual, societal, etc.) and these losses spill over to other people and the rest of society. If someone gets so sick or wounded that they cannot pay their medical bills (the cost of their physical rehabilitation), then not only is the person bankrupt but the hospital’s ability to provide services to others is impacted negatively.

When a gambler bets at a casino, the gambler is increasing their ceiling of possible outcomes while lowering the floor and the average (because the odds are in favor of the house or else they’d go broke). When someone buys insurance, the insured individual is raising their floor of possible outcomes while lowering the ceiling and the average (because the odds are in favor of the underwriter or else they’d go broke).

People with higher floors of possible outcomes can tolerate more risk. Society historically has benefited substantially when this risk is well managed (e.g. due to trading ships possibly getting lost at sea or an experiment failing).

Insurance can also be seen as the abstraction of shared risk (as the article points out). Two merchants could each swap half their goods with the other’s ship to hedge their risk against a single ship sinking. Or one merchant could financially back the other by paying for half the cost, taking half the losses, and receiving half the profit from a single ship. Or an underwriter could issue insurance based on the statistical likelihood of the single ship sinking. It is more abstract, but the desired outcome is the same — someone else is sharing in your life or endeavour, helping you weather setbacks and worse.

Insurance is about protecting your floor of outcomes and those of the people who depend upon you; it’s about avoiding the worst.

Gorsuch’s Selective View of ‘Religious Freedom’ – The Atlantic

in a lot of areas—anti-discrimination law, for example, or medical care, to name just two—religious claims involve the rights of many different people, each of whom has a claim to freedom of conscience. Those claims don’t depend on formal labels or church membership; and they all must be weighed in the balance. Balancing is hard, subjective, and ultimately often unsatisfying; yet balancing is the soul of constitutional law.

In the United States, whose culture and history has been shaped by Christianity, it’s easy to skip the balancing stage. Many people assume that “religious freedom” centers around familiar “religious” beliefs—Christianity, in other words—as opposed to those of religious outsiders, whether they are Mormons, Muslims, or atheists.

Source: Gorsuch’s Selective View of ‘Religious Freedom’ – The Atlantic

You can’t be socially progressive and economically conservative — Quartz

You don’t support something if you don’t care whether or not it happens.

if there’s no social progress funding, there’s no social progress. Passive support is no support at all.

if you want to be socially progressive, you have to stop looking at what you’re giving up and instead look at what you have and what others need. You can still live comfortably while helping others to live more comfortably and have more opportunity. If that doesn’t sound rewarding to you, that’s fine—you’re just not socially progressive.

Source: You can’t be socially progressive and economically conservative — Quartz