Friday, October 11, 2019

Cars of futures past/Class Foghorn Leghorn (Google it)

You probably haven't seen this 1948 short on the cars of the future...

But you may be familiar with this Tex Avery parody of the genre.

Tex Avery - MGM 1951-09-22 - Car of Tomorrow

Thursday, October 10, 2019

Four years ago (more or less) -- Wishful Analytics

You would be hard-pressed to find a group of reporters and analysts who have more to answer for than data journalists on the political beat in 2016.

The dean of the group, Nate Silver, turned in an embarrassingly bad series of analyses during the primary, but to his considerable credit, acknowledged his errors and greatly upped his game during the general election. For this reason, he was perhaps the only major poll watcher to have reasonable forecasts on the eve of the election. The rest of the group, however, learned absolutely nothing from the nomination and continued making the same egregious errors through the general.

Since then, the people who screwed up have pushed the self-serving idea that, while there may have been mistakes, they were things that are only apparent in hindsight.

In cases like this, you simply cannot beat contemporary accounts.

Friday, August 21, 2015

Wishful Analytics

As mentioned previously, Donald Trump's campaign has definitely strained the standard assumptions of political reporting, Though this is an industry wide problem (even Five Thirty Eight hasn't been immune), it is nowhere more severe than at the New York Times.

The trouble is that the New York Times is very much committed to a style of political analysis that takes the standard narrative almost to the formal level of a well-made play. The objective is to get to the preassigned destination with as much craft and wit as possible. Nate Silver's problems at the NYT generally came from his habit of following the data to conclusions that made his editors and colleagues uncomfortable (by raising disturbing questions about the value of their work).

Cohn's articles on Trump have been an extended study in wishful analytics, starting with a desired conclusion then trying to dredge up some numbers to support it. He really, really, really, really, really wants to see Trump as another Herman Cain. Other than both being successful businessmen, the analogy is strained -- Cain was a little-known figure who surged well into the campaign because the base was looking for an alternative to an unacceptable presumptive nominee – but Cohn brings up the pizza magnate at every opportunity.

In addition to reassuring analogies, Cohn is also inclined to see comforting inflection points. Here's his response to the McCain dust-up.
The Trump Campaign’s Turning Point

Donald Trump’s surge in the polls has followed the classic pattern of a media-driven surge. Now it will most likely follow the classic pattern of a party-backed decline.

Mr. Trump’s candidacy probably reached an inflection point on Saturday after he essentially criticized John McCain for being captured during the Vietnam War. Republican campaigns and elites quickly moved to condemn his comments — a shift that will probably mark the moment when Trump’s candidacy went from boom to bust.

Paul Krugman (like Silver, another NYT writer frequently at odds with the paper's culture) dismantled this argument by immediately spotting the key flaw.
What I would argue is key to this situation — and, in particular, key to understanding how the conventional wisdom on Trump/McCain went so wrong — is the reality that a lot of people are, in effect, members of a delusional cult that is impervious to logic and evidence, and has lost touch with reality.

I am, of course, talking about pundits who prize themselves for their centrism.


On one side, they can’t admit the moderation of the Democrats, which is why you had the spectacle of demands that Obama change course and support his own policies.

On the other side, they have had to invent an imaginary GOP that bears little resemblance to the real thing. This means being continually surprised by the radicalism of the base. It also means a determination to see various Republicans as Serious, Honest Conservatives — SHCs? — whom the centrists know, just know, have to exist.


But the ur-SHC is John McCain, the Straight-Talking Maverick. Never mind that he is clearly eager to wage as many wars as possible, that he has long since abandoned his once-realistic positions on climate change and immigration, that he tried to put Sarah Palin a heartbeat from the presidency. McCain the myth is who they see, and keep putting on TV. And they imagined that everyone else must see him the same way, that Trump’s sneering at his war record would cause everyone to turn away in disgust.

But the Republican base isn’t eager to hear from SHCs; it has never put McCain on a pedestal; and people who like Donald Trump are not exactly likely to be scared off by his lack of decorum.

Cohn's initial reaction to his failed prediction was to argue that the polls weren't current enough to show that he was right. When that position became untenable, he shifted his focus to the next inflection point:
Mr. Rubio, the senator from Florida, has a good case to be considered the debate’s top performer. A weaker Mr. Bush probably benefits Mr. Rubio as much as anyone, and if Mr. Bush raised questions about whether he would be a great general election candidate, then Mr. Rubio added yet more reason to believe he could be a good one. Mr. Rubio still has the challenge of figuring out how to break through a strong field in a factional party.

Mr. Walker won by not losing. In a lot of ways, the moderators’ tough, specific questions played to Mr. Walker’s weakness. He didn’t have much time to emphasize his fight against unions in Wisconsin. But he handled several tough questions — on abortion; on relations with Arab nations; what he would do after terminating the Iran deal; race; and his employment record — without appearing flustered or making a mistake. His answers were concise and sharp.

Mr. Kasich also advanced his cause. He entered as a largely unknown candidate outside of Ohio, where he is governor. But he was backed by a supportive audience, he deftly handled tough questions, and he had a solid answer on a question about attending same-sex weddings. His answer might not resonate among many Republicans, but it will resonate in New Hampshire — the state where he needs to deny Mr. Bush a path to victory and vault to the top of the pack.

It was Donald Trump, though, who might have had the weakest performance. No, it may not be the end of his surge. But he consistently faced pointed questions, didn’t always have satisfactory answers, endured a fairly hostile crowd and probably won’t receive as much media attention coming out of the debate as he did in the weeks before it. If you take the view that he’s heavily dependent on media coverage, that’s an issue. Whatever coverage he does get may be fairly negative — probably focusing on his unwillingness to guarantee support for the Republican nominee.
You might want to reread that last paragraph a couple of times to get your head around just how wrong it turned out to be. Pay particular attention to the statements qualified with 'probably' both here and in the McCain piece. The confidence displayed had nothing to do with likelihood – all were comically off-base – and had everything to do with how badly those committed to the standard narrative wanted the statements to be true.

This attempt to prop up that narrative have become increasing strained and convoluted, as you can see from the most recent entry
Yet oddly, the breadth of [Trump's] appeal and his strength reduce his importance in shaping the outcome of the race.

If Mr. Trump were weaker, or if his support were more narrowly concentrated in either New Hampshire or Iowa, he would play a bigger role in shaping the outcome. In that scenario, a non-Trump candidate might win either Iowa or New Hampshire — and he or she would be in much better position than the second-place finisher in the state where Mr. Trump was victorious.

If Mr. Trump were to win both Iowa and New Hampshire, the second-place finishers would advance as if they were winners. Assuming that one or both of the second-place finishers were broadly acceptable, the party would try to coalesce behind one of the two ahead of the winner-take-all contests on March 15.

In the end, Mr. Trump almost certainly won’t win the Republican nomination; the rest of the party will consolidate around anyone else. He can influence the outcome only if his support costs another candidate more than others. But for now, he seems to be harming all candidates fairly equally.

First off, notice the odd way that Cohn discusses influence. If I asked if you would like to “play a bigger role in shaping the outcome” of something, you would naturally assume I meant would you like to have more of a say, but that's not at all how the concept of influence is used in the passage above. Cohn is simply saying that a world where Trump was behind in one of the first two primaries might have a different nominee but since Trump wouldn't get to pick who would beat him, it's not clear why he would care and since there's no telling who would win in Cohn's alternate reality, it's not clear why anyone else would care either.

But even if we accept Cohn's framing, we then run into another fatal flaw. Put in more precise terms, “harming all candidates fairly equally” means that each candidate's probability of becoming president would have been the same had Trump not entered the race. This is almost impossible on at least three levels:

Trump has already produced a serious shift in the discussion, bringing issues like immigration and Social Security/Medicare to the foreground while sucking away the oxygen from others. This is certain to help some candidates more than others;

For this and other reasons, the impact on the polls so far has been anything but symmetric;

And even if Trump's support were coming proportionally from each of the other contenders, that still wouldn't constitute equal harm. Primaries are complex beasts. We have to take into account convergence, feedback loops, liquidity, serial correlation, et cetera. The suggestion that you could remove the first two primaries from contention without major ramifications is laughably naive.

Finally there's that “only.” Even if Trump isn't the nominee (and I would certainly call him a long shot), he can still influence the process as either kingmaker or spoiler.

While Cohn's work on this topic has been terrible, what's important here is not the failings of one writer but the current culture of journalism. This is what happens when even the best publications in the country embrace conventional narratives and groupthink, adopt self-serving but silly conventions and let their standards slip.

Wednesday, October 9, 2019

Hyperloop as terrorist target

There is an extraordinary disconnect between the reporters covering the hyperloop and the scientists and engineers who actually work in this field. With the possible exception of self-sustaining Martian colonies, there is no area where what you read in mainstream publications like the New York Times or the Atlantic will so completely contradict what you hear from independent experts. For the most part, the reporters aren't even aware of the questions they should be asking.

Case in point.

Other than this one somewhat superficial but otherwise pretty good article in the National Interest, there has been virtually no coverage of the hyperloop's unique vulnerability to terrorist attack. This is an enormously complicated issue, but there are certain aspects of it which are obvious to anyone who has seriously looked at the problem even though they very seldom make it into the breathless puff pieces we've come to expect.

Near top of mind for any engineer who has given the question of safety any thought is what will happen if there is a breach in the tube and the vacuum is compromised. At that point, a wall of air traveling at the speed of sound goes barreling down the tube in both directions. For those pods traveling toward the wall at nearly the speed of sound, it will certainly not turn out well. All of the occupants of the first pod will die instantly. What happens next is impossible to determine without extensive tests, but even allowing for the best-case scenario, you will have hundreds of people who need to be evacuated

From the tube which needs to be repressurized immediately. The passengers will then need to make their way to the closest escape hatch. The hatches themselves will present a considerable engineering challenge since they will need to be not only airtight but completely inaccessible from the outside lest they become yet another point of attack.

After you get these people out of the hundreds of miles of tube, you have to do something about the pods themselves. Keep in mind, the primary propulsion and braking of the pods is provided by linear induction motors at either end. I'm not going to spend a lot of time speculating on the best way of getting the pods out of the tube, but it is safe to say it will be neither trivial nor quick.

Then comes the massive job of getting the system back up and running. Not only will you have to replace the section with the original breach, you will have to completely clean the tube of debris, quite a bit of which will undoubtedly be sucked in. Then you will have to inspect every inch of the tube for structural damage and double-check every seal, escape hatch, thermal expansion joint, and other potential point of failure. You will have to make sure that there was no damage done to the magnetic levitation track. You will have to make absolutely certain that the pods are in perfect working order since, when running through the system, a loss of cabin pressure in one of these things means instant death for everyone inside.

There are few systems of Transportation infrastructure where a single attack can produce this level of damage and economic disruption. Of these, none offers the variety vulnerable points that the hyperloop does. If we are talking about elevated tracks, which seems to be the primary approach being proposed, every section of tube and every pylon supporting it is a potential point of attack. Hardening all of those targets might be possible, but it would be unimaginably expensive.

Tuesday, October 8, 2019

Tuesday Tweets -- Great Unwinding* edition

*See yesterday's post.



And from the wages of Strauss thread.


And one just for the hell of it.


Monday, October 7, 2019

Out with the Wages of Strauss, in with the Great Unwinding

We have reached a point in the show which always makes the fans a little nervous. we have decided that one of our oldest and biggest storylines is starting to come to a natural conclusion so we need to begin wrapping up the loose ends and introducing the next one.

For years now, when it came to politics, the big recurring story was what you might call the wages of Strauss. we pushed the we pushed the idea that either the main cause or the essential context of almost every major political development over the past couple of decades came from the conservative movements relatively public conclusion that their agenda, while it might hold its own for a while and perhaps even surge ahead now and then, was destined to lose the battle of public opinion in the long run.

This left them with two choices, either modify their ideas so that they could win over the majority of the public, or undermine the Democratic process through a Straussian model, an approach based on controlling most of the money and increasing the influence that could be bought with that money, changing government so that an ever smaller part of the population had an ever-larger role in governing the country and creating a sophisticated three-tiered information management system where trusted sources of information were underfunded and undermined, the mainstream press was kept in line through a combination of message discipline and incentives with special emphasis placed on working the refs, and the creation of a special media bubble for the base which used spin, propaganda, and outright disinformation to keep the canon fodder angry, frightened, and loyal.

For a long time this approach worked remarkably well, but you could argue that the signs of instability were there from the beginning, particularly the difficulty of controlling the creation and flow of disinformation, the vulnerability to what you might call hostile take over, and the way the system lent itself to cults of personality.

We've had a good run with this storyline for a long time now, but it seems to be coming to a resolution and it has definitely lost a great deal of its novelty. (Lots of people are making these points now.)

The next big story, but one which we believe will dominate American politics for at least the next decade or so will be how the Republican party deals with the unwinding of the Trump cult of personality. Dismantling such a cult is tremendously difficult under the best of circumstances where the leader can be eased out gently, but you have with Donald Trump someone who has no loyalty to the party whatsoever and who is temperamentally not only capable but inclined to tear the house down should he feel betrayed.

If Trump continues to grow more erratic and public disapproval and support for his removal continues to grow, then association will be increasingly damaging to Republicans in office. However, for those same politicians, at least those who come up for election in the next two to four years, it is not at all clear that any could survive if the Trump loyalists turned on them.

But this goes beyond individual candidates. Trump's hold on the core of the base is so strong and so personal that, if he were to tell them directly that the GOP had betrayed both him and them, they would almost certainly side with him. They might form a third party, or simply boycott if you elections, or, yes, even consider voting for Democrats.. I know that last one sounds unlikely but it is within the realm of possibility if the intraparty civil war got bitter enough.

Obviously, if Trump survives this scandal and is reelected in 2020, all of this is moot, but if not, then how things break will be a story we’ll be glad to have been following.

Friday, October 4, 2019

I do, however, believe Elon Musk can deform flatware with the force of his mind

More from Bethany McLean's exceptional report on Solar City.

The controversy over SolarCity, which has dovetailed with questions about Musk’s mountain of debt and profit shortfalls, offers a window into the mind-set of America’s most outlandish and unpredictable CEO. Musk’s believers argue that the details of his ventures don’t matter: It’s the grand vision that counts. “The guy has a will to make stuff happen that is extraordinary,” says someone who worked closely with Musk. “He willed Tesla to happen. And in willing a reality into existence, he might not stick to the facts.” But in the case of SolarCity, Musk’s penchant for making promises he can’t deliver on turned out to matter a great deal—and could even pose a threat to his entire empire.

I remember someone (I believe it was James Randi) observing that when you presented a true believer with incontrovertible proof that Uri Geller they would often explain away the fraud, arguing that you had to make accommodations for someone who could do the impossible.

Elon Musk didn't will Tesla into existence; he didn't even found it. That doesn't take away from Musk's accomplishments building and promoting the company, but it wasn't magic. When people start describing impressive but ordinary accomplishments in miraculous terms, they start thinking in those terms as well.

Thursday, October 3, 2019

We expect to have the 3-kilometer test track completed by 2021 or 2119, whichever comes first

Not sure how I missed this piece in the National Interest on potential security issues with the hyperloop. The reporting is a bit thin in spots, but it generally does a good job and it's almost the only coverage one of the most important aspects of the story has received.

This part, however... not so much, though my problem is more with the genre than with this article.

“We’re aiming for a city to city Hyperloop system, not within twenty years, not within ten years, but just within four years,” said Tim Houter, CEO of Hardt Global Mobility, at a TNW conference in Amsterdam.

Houter’s startup is developing a Hyperloop system with support from the Technical University of Delft, Dutch railway company Nederlandse Spoorwegen, and multinational construction company BAM. It is one of many Hyperloop projects presently underway.

This was always a bad joke, another example of treating the most absurd of claims as if they were serious proposals from credible people. Elsewhere Houter talked about connecting Paris and Amsterdam, 500 km apart requiring a thousand miles of tube. As far as I can tell, two of the four years in, here's what they've got.

‘Fully operational’ in this case means that the system – vacuum steel tube and guiding tracks, passenger pod, magnetic levitation and propulsion system and switching between tracks – can work in a real size environment. The next step will be a 3-kilometer long near-vacuum test tunnel, in which the actual high speeds can be obtained.
There are not "many hyperloop projects underway." There are two or three that might reach some functional or abortive stage or at best achieve tourist attraction status in places like Dubai. All the rest of the plans you hear about are either the pitches of con men or the ravings of cranks or some mix thereof.

Wednesday, October 2, 2019

Tuesday(ish) Tweets

We'll be coming back to this one.

Tuesday, October 1, 2019

Four years ago (more or less) -- taking all the fun out of lying

One of the changes we noted in 2016 was the breakdown, or at least the beginning of a breakdown, of polite journalistic conventions that had played an essential role in enabling the mainstream side of the conservative movement's media strategy. As long as you played nice and didn't blatantly insult the interviewer's intelligence, you could lie freely and expect at worst a mild show of resistance (not even that for a Paul Ryan).

There was, however a limit and Trump's advocates started passing it almost immediately, and the relationship between conservatives and the mainstream media (including the news side of Fox) immediately started to decline.

Of course, Wallace always had a spine, but now we've got Chuck Todd standing up on his hind legs.

Tuesday, August 9, 2016

The loss of plausible deniability

One important point to keep in mind while following this years election is that, of the truly objectionable things about the Trump campaign, very few are actually new. Instead, we have all sorts of practices that have always been unacceptable, but which are now being presented in a way that makes them undeniable.

If you remember the elections of 2000 and 2004, you will probably recall talk of Karl Rove and his mastery of "political jujitsu." It was generally discussed as if it were some sort of mystical Jedi mind trick that allowed Rove to make strings into weaknesses and weaknesses into strengths. Mainly, it came down to the realization that most reporters would respond to obvious lies with straight faces and no follow-up questions.

In 2004, I remember Republican operatives making the argument that George W. Bush's military record compared favorably with that of John Kerry. Just to review, Kerry was a legitimate war hero in terms of courage, sacrifice, and effectiveness. On the other side of the ledger, even if we push aside all of the accusations and contested points about favoritism and completion of requirements, there is a relatively cushy stint in the National Guard.

These and other clearly untrue statements were usually allowed to stand largely because this was a symbiotic relationship. It was in both the source's and the journalist's interests to keep this relationship going and not to push the boundaries in either direction.

The lies we've been hearing recently are not necessarily that much more blatant, but Trump and associates are no longer observing the social conventions that traditionally went with them. If a reporter asks about your candidate's military service and you reply by saying all sorts of nice things about the National Guard, that reporter can move onto the next question without looking like a complete moron. If you look reporters in the face and tell them that twice cheating on then dumping your wife for a younger, more glamorous woman qualifies as a sacrifice, you leave the reporters looking like asses just for letting you get the words out of your mouth.

Which brings us to (from TPM):
Khizr Khan, the father of the Muslim soldier, said in his speech at the Democratic convention last week that Trump had "sacrificed nothing." And Trump hit back over the weekend, saying that he's "made a lot of sacrifices," like creating jobs.

During a CNN panel discussion Sunday, Trump surrogate Scottie Nell Hughes defended Trump's comments.

"Mr. Trump was responding to the fact of sacrificing. Nowhere ever did he ever say that his sacrifice was equivalent or more or even close to what the Kahn’s had given up," she said.

CNN host Fredricka Whitfield then asked, "Is creating a job considered a sacrifice?"

"You know what, creating jobs caused him to be at work, which cost him two marriages,” Hughes said in response. “Time away from his family to sit there and invest.

Clinton surrogate Bernard Whitman jumped in to say, "infidelity cost him."

"No, actually being away from his family, he’s admitted it,” Hughes insisted. "That is the spin of the media and ongoing bias."
 "Creating jobs" normally implies actually paying the people who do work for you, but we can save that for another day.

Monday, September 30, 2019

Overproduction of elites

This is Joseph

I was talking to Mark, and he noted that the elites in a lot of areas come from a surprisingly narrow background.  They all went to top schools and/or lived in key places. We were discussing what this meant, and to me it is a symptom of something we mostly get wrong as a society.

There is a tendency to talk of there being a shortage of people, for example as a way to justify high CEO pay. And maybe there is some shortage of good people with the "right background" but this sort of background homogeneity is much more aligned with elite overproduction.

Let me give what I think is a good example of elite underproduction:Union officers in the Civil War. It is pretty clear that West Point was dominated by the Southern elite at the time of the Civil War, leaving the Union with a serious deficit of competent officers. So look at some of the people who become important officers: a college professor and a person struggling with alcoholism. It is a good marker of a shortage of people with the key skills when you see people from a wide variety of backgrounds being given a chance. Mark talked about the US job market in 1997, when people from a wide range of backgrounds could get jobs just by showing interest and competence -- so you would see people in jobs quite unrelated to what they were trained in or from very diverse backgrounds.

If there really was a critical shortage of CEOs, you'd see high school teachers taking on business careers and nobody would care what school your MBA came from.

Instead, what you have are 10 trained people for every job.  This has long been true for much of the academic world. Being from a top school, for example, becomes a lot more important as a way of winnowing the field once it is flooded with competent people. Look at how unusual it was for Elizabeth Warren to be at Harvard:
Former Harvard colleagues say Warren’s background stood out at the institution, where graduates routinely clerk for Supreme Court justices. For years, she was the only tenured professor on the law faculty who had attended a public law school in the U.S.
That is a sign of there being too many competent people, so that schools can afford narrow recruitment criterion and still get top people.

Now, where this matter is public policy. We should be asking about how to respond to elite overproduction (often something that causes much social tension) and about how to equalize opportunity.  But I think the idea that we are short of good people for top employment opportunities (in general, small exceptions may exist) is daft.

Friday, September 27, 2019

Imagining the future of 1960

Always interesting to see how the various decades of the 20th Century viewed progress. We tend to focus on the turn of the century and the post-war era. This film from GM promoting their 1940 World's Fair pavilion is a good reminder that the Depression hadn't managed to dampen the faith in a technology-driven future.

Note also the connection drawn between the closing of the American frontier and the opening of the technological one.

If you're impatient, the cool model work starts around 9:00.

Thursday, September 26, 2019

Trump and the GOP -- Jenga time

Talking with a friend earlier about the day's events. He felt that we had reached the point where it was clearly in the Republicans' interest to start to turn on Trump. I disagreed. My take was that it would be in the GOP's interest to have some distance from the man, but probably not enough so to justify the cost of getting away.

With Watergate, the process was relatively painless, but things are different. Trump has the ability and the temperament to inflict tremendous damage on the party. The Republicans have got to unwind a cult of personality without triggering an intra-party civil war.

I'm  honestly at a loss for how to approach this enormous game of political Jenga. An anonymous senate vote might actually help, working along the same principal as giving one soldier in a firing squad a blank cartridge, but I don't think we can take it seriously (though Campos maybe does just a little).

Here's what we had to say a couple of years ago about the danger Trump presented to the GOP. If anything, I think it's gotten worse.

Tuesday, February 28, 2017

GOP Game Theory -- things are still different

"It's probably better to have him inside the tent pissing out, than outside the tent pissing in."

    LBJ on FBI Director J. Edgar Hoover,

[UPDATE: The conversation continues with The nuclear moose option and The Republicans' 3 x 3 existential threat.]

Let's start with a prediction:
Senate Minority Leader Charles Schumer (D-N.Y.) predicted on Tuesday that Republicans will split with President Trump within months unless the administration changes course.0
"My prediction is he keeps up on this path...within three, four months you're going to see a whole lot of Republicans breaking with him," Schumer said during an interview with ABC's "The View."
Schumer argued while most GOP lawmakers aren't yet willing to break publicly from the White House, they are privately having "real problems" with Trump's policies in his first month.

"A lot of the Republicans, they're mainstream people. ... They will feel they have no choice but to break with him," he said.
GOP leadership are largely dismissing any early signs of discord between Congress and the White House as they slowly try to make progress on an ambitious agenda.

Ed Kilgore, however, points out that Trump may not be as toxic as many people think:

So while it is hard to deny that Trump is amazingly unpopular for a new president, unless his approval ratings trend farther down the way even those of popular presidents typically do, his party may not suffer the kind of humiliation Democrats experienced in 2010. For all the shock Trump has consistently inspired with his behavior as president, there’s not much objective reason for Republican politicians to panic and begin abandoning him based on his current public standing. But in this as in so many other respects, we are talking about an unprecedented chief executive, so the collapse some in the media and the Democratic Party perceive as already underway could yet arrive.

The relationship between the Trump/Bannon White House and the GOP legislature is perhaps uniquely suited for a textbook game theory analysis. In pretty much all previous cases,  relationships between presidents and Congress have been complicated by numerous factors other than naked self-interest--ideological, partisan, personal, cultural--but this time it's different. With a few isolated exceptions, there is no deeply held common ground between the White House and Capitol Hill. The current arrangement is strictly based on people getting things they care about in exchange for things they don't.

However, while the relationship is simple in those terms, it is dauntingly complex in terms of the pros and cons of staying versus going. If the Republicans stand with Trump, he will probably sign any piece of legislation that comes across his desk (with this White House, "probably" is always a necessary qualifier). This comes at the cost of losing their ability to distance themselves from and increasingly unpopular and scandal-ridden administration.

Some of that distance might be clawed back by public criticism of the president and by high-profile hearings, but those steps bring even greater risks. Trump has no interest in the GOP's legislative agenda, no loyalty to the party, and no particular affection for its leaders. Worse still, as Josh Marshall has frequently noted, Trump has the bully's instinctive tendency to go after the vulnerable. There is a limit to the damage he can inflict on the Democrats, but he is in a position to literally destroy the Republican Party.

We often hear this framed in terms of Trump supporters making trouble in the primaries, but that's pre-2016 thinking. This goes far deeper. In addition to a seemingly total lack of interpersonal, temperamental, and rhetorical constraints, Trump is highly popular with a large segment of the base. In the event of an intra-party war, some of this support would undoubtedly peel away, but a substantial portion would stay.

Keep in mind, all of this takes place in the context of a troubling demographic tide for the Republicans. Their strategic response to this has been to maximize turnout within the party while suppressing the vote on the other side. It has been a shrewd strategy but it leaves little margin for error.  Trump has the ability to drive a wedge between a significant chunk of the base and the GOP for at least the next few cycles, possibly enough to threaten the viability of the party.

The closest analogy that comes to mind is the Democrats and Vietnam, but that was a rift in a big-tent loosely organized party. The 21st Century GOP is a small tent party that depends on discipline and entrenchment strategies. It's not clear that it would survive a civil war.

Given that, I suspect the next year or two will prove Schumer wrong. There is some evidence that the president's polling has stabilized, perhaps even rebounded a bit, but even if the numbers go back into free fall, Republicans in the House and the Senate will be extremely reluctant to break from Trump with anything more than isolated or cosmetic challenges.

This isn't just a question of not wanting Trump outside the tent pissing in; this is a question of not wanting Trump outside the tent tossing grenades. 

The Stag Hunt Framework

I have a feeling this conversation is about to become relevant again, so this might be a good time to reintroduce some concepts.

Tuesday, August 6, 2013

Metablogging -- stag hunts, misalignment, principal agents and all that jazz

Shortly after Josh Marshall posted this analysis of recent events in the GOP, Joseph called me up to compare reactions. We've been having this conversation for so many years that much of it has devolved into a self-referential shorthand. As an illustration, at one point, after a fairly long-winded comment by me, Joseph simply said "Stag hunt." and tossed the ball back to me and we moved on to the next topic.

We agreed (with, I assume, fingers crossed on both ends of the line) that we'd write some posts on the subject, but I'm starting to think that it might be more useful to step back for a minute and talk about how we've been framing the question of what's going on in the Republican Party (politically, not socially or in terms of policy. Those are entirely different metaposts).

For years now, the two of us have been talking about the post-Tea Party GOP in terms of a multi-player stag hunt. Over the past few years the stakes (particularly the costs of failure) have increased. At the same time, participation rates required to take down the stag have also increased. As a result, progressively smaller groups have gained the power to kill the enterprise. (In a different conversation Joseph pointed out that, in a military context, shooting deserters is also a predictable result of this situation.) We could dig deeper into examples and implications (particularly with respect to the trade off between the power of an alliance vs. its stability) but for now I want to limit the discussion to framing.

(there might also be a place here to talk about symmetry breaking, but I'd need to give that some thought first.)

Another way of looking at the story we've found useful is to look at misalignment of interests, especially what looks to us two non-economists as a particularly nasty two-level principal agent problem where a small group of big donors determine the pool of viable candidates and a relatively small but coherent subgroup of the primary voters make the purchasing decisions for the entire party. You'll notice that, like the stag hunt frame, under this scenario small groups can acquire disproportionate power.

And of course there's the mandatory Influence reference, framing the story in terms of social psychology. If you check out the chapters on commitment and consistency, social proof, and scarcity you'll find all sorts of applicable discussions of the ways groups united by a common belief system deal with ideological challenges and the loss of dominance.

Nothing particularly fresh or profound here, but these idea have proven a pretty good framework recently. I'm not saying they should be the basis of the standard narrative -- I'm not sure there should be a standard narrative -- but they do come in handy. More importantly, I think you can make the case that too little of the public discourse is spent examining underlying assumptions and asking about the different ways to frame our questions.

Wednesday, September 25, 2019

Twilight of the Unicorns -- WeWork ReCap

I don't think I'll have enough time for this one. I've had years to point out the dubious claims and questionable business logic of companies like Uber, Netflix,Tesla/Solar City and whoever's promising a hyperloop this week, but when I find perhaps the purest example of a 21st bullshit and hype company, the damned thing starts to collapse the moment it gets on my radar.

  Couldn't happen to a nicer guy.

Tom Braithwaite points out there's plenty of blame to go around.
 Even as he elevates sanctimoniousness to an art form, Mr Neumann has withdrawn massive amounts of cash from his pre-IPO, pre-profit company and embraced huge conflicts of interest.

He has taken out $700m in share sales and loans. He charged the company $5.9m for the trademark “We”. He part-owned four properties that were leased to the company for $8m last year.

It is easy to mock Mr Neumann. But others share responsibility. To lay all the blame at his door is to fall into the old trap of seeing all unicorns through the prism of their founder-gods.

There is a board, which is supposed to provide checks and balances. In descending order of tenure: Bruce Dunlevie, a founding partner at venture capital firm Benchmark, who has been there since July 2012; Steven Langman, co-founder of private equity firm Rhône; Lew Frankfort, former chief executive of luxury goods brand Coach; John Zhao, chief executive of Chinese investment firm Hony Capital; Mark Schwartz, former Goldman Sachs Asia head; and Ron Fisher, a SoftBank director, who joined in November 2017.

The all-male composition of the board is just the most glaring example of its tone deafness. The directors signed off on all of Mr Neumann’s efforts to extract money from the company. Belatedly, the group is reversing some of the cavalier decisions and improving corporate governance as it tries to win over public investors. Mr Neumann is returning some of the payments.

Of course, the suffering won't quite be distributed equally.
The fine print is known as a ratchet, and speaks to the opaque nature of private markets and sky-high valuations. The real estate start-up’s parent company was valued at $47 billion after its last funding round from SoftBank.

In the case of the WeWork’s parent company, it was a “partial ratchet” disclosed on page 115 of its S-1 filing. If the stock price comes in below a certain price in the IPO, investors like SoftBank will receive additional shares as compensation.

If triggered, these protections usually result in only a few million dollars worth of extra shares, according to Matthew Kennedy, senior IPO market strategist at Renaissance Capital. But because SoftBank’s latest round was so large and the possible down-round was looking to be less than half of that, the provision was expected to result in the world’s largest IPO ratchet.

“As a result, the founder and employees would see their own shares diluted,” Kennedy said. “It doesn’t look good for common shareholders to see that extra dilution on top of a down around.”

We'll give Stoller the last word.

Tuesday, September 24, 2019

Bright 2's future not 2 Bright

One of my little blogger's quirks is to make make mental notes of promised developments in stories I'm following, and to Google them from time to time to see if anything has come of them. One of these stories that caught my eye was the too-good-to-be-true roof tiles from Elon Musk. It took a while but that one finally took an interesting turn.

Another big story that suddenly got very quiet was the sequel to the Netflix film Bright. The company announced that it had been a tremendous success, bringing in unprecedented numbers. Bright 2 was announced almost immediately.

Say what you will about Netflix, it's a company that can move quickly when it wants to, and it really wanted a blockbuster franchise, so you would expect an aggressive production schedule. Instead, there were various delays and rescheduling, all handled with an uncharacteristic lack of fanfare from a company that spends billions on marketing and publicity.

And then this.
As it turns out, production was actually slated to take place earlier this year, it just had to get to delayed due to Smith's perennially packed schedule. Lucy Fry, who starred in the first Bright as the magical Tikka, spoke to this week ahead of her new TV series, Godfather of Harlem, and explained why Bright 2 has been on the back burner.

"We were going to do it this year, and then it didn't happen because of Will's schedule," Fry told us. "And I really hope they do another one because I had so much fun making that movie. So, I just hope we get to do it again."

So does that mean it will be rescheduled soon, or is Bright 2 going to be sent to production hell for the foreseeable future? We asked Fry what was in store for Bright 2 going forward and, for now, she's just as in the dark as the rest of us.

"No, I don't know," she said. "I'm sorry! I wish I did know."

When they stop even pretending to want to reschedule, that's a bad sign.

When you look at Netflix's content catalog, things they own rather than merely license for the next 2 to 7 years, you see that it is awfully thin, particularly in the absolutely essential areas of children's programming where their slate of Originals consist almost entirely other people's properties, shows with legs and lots of episodes like friends, and big blockbuster franchises. Of these three, the franchises are probably the least important in terms of bottom line but  arguably the most important in terms of perceived success.

Given this, if Netflix actually believed that the Bright franchise was their chance to fill in that hole in their catalog and to reassure investors that the loss of Star Wars and the Marvel Cinematic Universe wasn't going to be a problem, the company would be doing everything in its power to get this next film out as soon as possible, and when a company is spending 10 to 15 billion dollars annually on content and another billion plus on marketing, they can do a hell of a lot.

It's true that Will Smith is a big and busy star, but he is no more big or busy than he was a few years ago, particularly after dropping out of Suicide Squad. If he and Netflix believed this franchise was really going to be that big, they probably would have gotten it done by now, it certainly wouldn't be hanging in the I-don't-know-we'll-see limbo where it currently resides.

Does that mean that Netflix lied about the viewership numbers for the first installment? Probably not though it's a possibility we should always consider. Far more likely that they were selective in the numbers they presented. Hit is not a concept that can be measured with a scalar, especially not in this context. Did people seek out the show or simply go along with the autoplay? What was the impact on churn? What about repeat viewings?  Did people show a preference for this show over other similar programs on the service?

With a major star, a massive marketing budget, and a pricing system where existing members pay no additional charge to see the movie while new members get the first month free, it is not difficult to rack up huge initial viewership numbers. Other numbers matter much more, and the people who have seen those don't seem all that eager to push ahead with this project.

Why should you care? In terms of the film itself, you probably shouldn't. But when dealing with unicorn companies, it's always good to question the official narratives.