Tuesday, October 1, 2013

Washington Monument Syndrome (or, 10 Things the Shutdown Spared)

It's official: The federal government of the United States has shut down. Well, sort of. 

You see, despite the media outcry, the partisan banter - and, yes, the 800,000 federal workers who were furloughed today - the federal government largely goes marching forward without a hitch from the perspective of the vast majority of Americans. While the tactics of either political party are debatable, and a less myopic solution is preferable no matter your political persuasion, it's quite clear that the things that are cut when the government shuts down are fewer than one would expect, not to mention rather arbitrary.

Or perhaps, these things are not arbitrary. "Washington Monument Syndrome" is a term which describes a phenomenon whereby government agencies faced with cuts will tend to cut the most visible and desirable elements of their programs in attempt to cull public support for restoration of funding. As this article describes it:
"When threatened with even modest cuts, cutthroat administrators can shut down only their departments’ most visible services and then sit back in comfort while they wait for legislators to capitulate. The syndrome has played a crucial role in making our government what it is today: a bloated monstrosity that is physically incapable of consuming less than it did the day before." 

Saturday, September 28, 2013

Complex Problems: The Multiplication of Doubt

In my last two posts which build the foundation of my epistemological framework, I have described how the complexity of problems can be defined through building a hierarchy of constructs and relationships in the order of their complexity. There, I briefly describe the most basic elements with a rudimentary explanation for its complexity ranking as a standalone element. To follow, I described the most basic element, existence, and the general concept of abstraction, which allows us to discuss doubt as a concept which is the abstraction of certainty.

Let us build on the previous discussion here of the nature of knowledge as being inherently probabilistic. Let the certainty of the truth of any given proposition X be represented as Pr(X) in standard statistical notation. Suppose X is some basic proposition with the lowest level of complexity: "The spoon exists," for example, where a spoon is observed on a table in front of you. Having experienced the spoon in front of you, and indeed, currently experiencing it in front of you, you would have supreme confidence in the existence of the spoon. You could not provide a logical proof of the spoon's existence, but you could say that you are as close to absolute certainty in this proposition as one may be; in other words, the limit of Pr(X) approaches 1 in this case. For ease of demonstration, let's suppose Pr(X) = 0.9999.

Tuesday, September 24, 2013

S*** My Future Fed Chair Said

In honor of Janet Yellen, the former President of the San Francisco Federal Reserve, being recently elevated to "frontrunner" status for the chair of the Federal Reserve Board, I present a list of past quotations from Mrs. Yellen here. All emphasis is my own.
"While a tightening of credit to the subprime sector and foreclosures on existing properties have the potential to deepen the housing downturn, I do not consider it very likely that such developments will have a big effect on overall U.S. economic performance." - Speech to the Money Marketeers of New York University, April 26, 2007 (link
Of course, these events very much did have an impact on overall economic performance, and continue to do so today, some 6 years later.

Friday, September 20, 2013

Existence, Abstraction, and Doubt

A proposition expressing existence takes the form "X is". This form of proposition is the most basic form and can serve as a building block from which other, more complex propositions can be constructed. Let us examine more closely the nature of existence and the implications for the use of existence as the lowest-order proposition.

Any animate being can be shown to demonstrate the awareness of existence. Animals, though they are not self-aware and thus may not be cognizant of the concept of existence, will nevertheless react to stimuli in a manner consistent with the awareness of this concept. A dog, for example, will not attempt to run through a wall; it recognizes the existence of the wall and can understand that its efforts would be in vain. It, perhaps, does not know this innately, but through experience it becomes highly confident that the wall exists. Similarly, its eyes will follow an object that it is interested in, such as a ball or a morsel of food; this action directly represents the recognition of the existence of those objects.

Tuesday, September 17, 2013

Incentive and Investment: The Future of Crowdfunding and Venture Capital

Over the course of the last year, Kickstarter has risen to prominence as one of the easiest and most effective ways to fund projects and ideas. By relying on the collective wisdom of crowds, Kickstarter tends to fund projects which are generally recognized by would-be investors as good ideas. The market forces at work here are generally no different than those which govern the more established, more institutional market for venture capital. It's no secret that financial incentive is a great motivator for producing discerning analysis and careful decision-making. 

However, there are several variables that separate Kickstarter projects from venture capital investing. Most of these involve reducing the barriers to entry for small-time investors. An analogy to political fundraising is appropriate: large institutions may dominate funding in federal elections (particularly for the presidency), but it would be impractical for these institutions to devote time and resources supporting candidates for state and local offices. Nevertheless, funding is no less important for those candidates - and in fact, campaign dollars spent there have a much greater impact on the race.