You thought I was exaggerating with the Muskmas line, didn't you?

This amusing thread from Gizmodo's Matt Novak beautifully illustrates some points we've been making for a long time. The language and imagery we use to describe technology in the 21st century has increasingly become that of myth and magic, even for advances that are mundane or trivial. At the same time (and I'm sure the causal relationships run both ways here), our default ways of thinking about tech and innovation have become increasingly dominated by what we've called magical heuristics, mental modes and tools only appropriate for a nonrational, supernatural worldview.

The worst part is that Donald Trump’s batshit press conference is distracting me from the amazing emails piling up in my inbox defending Elon Musk’s honor pic.twitter.com/I7Dna2EzVd

— Matt Novak (@paleofuture) July 16, 2018

The best line to hit my inbox from the Musk defenders so far: “......without his help we on this planet are doomed.”

— Matt Novak (@paleofuture) July 16, 2018

The second best line so far: “The guy Musk has done more for humanity in the last 10 years than anyone has in the last 2000.”

— Matt Novak (@paleofuture) July 16, 2018

Obviously, it would be a mistake to treat the crazy emails that show up in a journalist's inbox as a representative sample, but before we dismiss these comments as the ravings of random lunatics, go back and take a look at this previously discussed Rolling Stone cover story. Are the messianic unicorn comments from Elon Musk's supporters really that much more over-the-top than this?

Musk will likely be remembered as one of the most seminal figures of this millennium. Kids on all the terraformed planets of the universe will look forward to Musk Day, when they get the day off to commemorate the birth of the Earthling who single-handedly ushered in the era of space colonization.
...
“Musk is a titan, a visionary, a human-size lever pushing forward massive historical inevitabilities – the kind of person who comes around only a few times in a century”

.

Of course, the Rolling Stone piece is itself a bit of an extreme case, but not an entirely unrepresentative one. We've collected dozens of examples over the past few years of Silicon Valley saviors and wondrous sorcery in tech drag. These stories ranged from partially to primarily bullshit, but they have had a great impact on the way we invest, make public policy decisions, and pursue research. In other words, we are paying a real price for believing in these fantasies.

Deficits

This is Joseph.

This is an interesting tweet thread by Jeffery Brown.  Here is an image of a few tweets:

What is really interesting here is not that Dr. Brown is wrong.  He isn't.  He is completely correct. 

What is interesting is where the focus is.  In the thread he names two MMTers, Bernie Sanders (an independent failed presidential nominee) and Alexandria Ocasio-Cortez (a Democratic nominee for the house who is not even elected yet). 

Now I am huge believer in fiscal responsibility.  Here is Fortune on the recent tax cuts:

Trump’s heady economic potion, however, is masking misguided policies that could leave those same businesses with a severe hangover from today’s celebration. The U.S. government’s huge and growing budget deficits have become gargantuan enough to threaten the great American growth machine. And Trump’s policies to date—a combination of deep tax cuts and sharp spending increases—are shortening the fuse on that fiscal time bomb, by dramatically widening the already unsustainable gap between revenues and outlays. On our current course, we’re headed for a morass of punitive taxes, puny growth, and stagnant incomes for workers—a future that’s the precise opposite of what Trump champions.

I think Jodi Beggs identified why this is important here:

I would like to think carefully about the deficit.  I think that balance of payments is important and I remember that hyper-inflation is something that can really happen.  But if the focus is on minor players on the party out of power and not on the people actually increasing the deficit now, it is now wonder that people wonder about motives.  If the deficit becomes a political argument than the bad fiscal consequences I would like to avoid become a lot more likely. 

More on health care costs

This is Joseph.

As projections go, this one is shocking:

Medical services are expensive. There is no getting around it. The average family health insurance premium in the US is approaching $20,000. By one estimate, average family premiums could rise to 100 percent of US median household income by 2033 if trends continue.

Even now, the median family income in the United States is fifty-nine thousand dollars, which means health costs are starting to dominate expenses.  In parallel with the cost of housing (which is growing faster then wages right now), it is pretty clear that either wages need to go up soon or we need to find a method to control costs. 

One feature of health care costs that is odd is the presence of different costs for different customers (off the street versus negotiated insurance costs versus medicare/medicaid rates) and a complete lack of pricing transparency.  It is difficult to save up for medical procedures when you don't know the actual price and it is common for bills to be a surprise. 

Obviously, consistent and transparent prices are going to be needed in order to utilize market forces, as is competition.  I think that it isn't a surprise that centrally planned health care systems have proved quite a popular solution to this problem. 

Which doesn't mean that is the way to go.  But if we are going to find a way forward then we need to find a way to contain costs.  I see this as the central question of health policy at the moment. 

What next for health care costs?

This is Joseph

I read with great interest this article by Edward Murphy on US health care costs.  The bottom line was quite interesting:

In March, three researchers from the Harvard T. H. Chan School of Public Health published a study in JAMA analyzing the well-known reality that the United States spends dramatically more on health care than other wealthy countries. They compared the US, where health care consumes 17.8 per cent of gross domestic product, to 10 comparable nations where the mean expenditure is 11.5 percent. Despite spending much less, the other countries provide health insurance to their entire populations and have outcomes equal to or better than ours. The researchers found that this inefficiency gap is primarily driven by two characteristics of the US system: the high cost of pharmaceuticals and inordinate administrative expenses.

and

It is not in the interest of huge profit-making corporations to restrain the overall cost of the US health care system. In fact, their interest is served by driving health care expenditures higher. When combined with the spending analysis provided by researchers, the financial data disclosed by public corporations point to a path that the country must follow to make our system more coherent and less costly. Any progress will require driving down pharmaceutical pricing and reducing administrative costs imposed by middlemen. We are not doing that yet but, ultimately, we must. 

This is an evergreen topic given that health care is expensive and there is a sense that it doesn't have quite the overall outcomes that you'd expect.  If it was just that a wealthier country spends more on health to get better outcomes, then I would say that the market was functioning effectively.  It's unclear to me that being wealthy means an interest in higher administrative costs, although I guess hedge funds might be an example of this phenomenon.

This is relevant because there is a real issue with laws to regulate health care, both in terms of payments and the laws themselves.  I see this as the end of the idea of a regulatory framework for the private marker (the affordable care act) and a prelude to a pivot to some other approach. I am waiting to see who might provide leadership on this front.  What is the vision of the Trump administration on health care policy and cost containment?  How are they going to tackle this difficult and nearly intractable issue?

Curious minds are waiting for the other shoe to drop and see what the new plan is

Postscript:  And in case you think these high profits are needed for innovation, Noah Smith has a great tweet here. 

A follow-up to yesterday's post

This is Joseph

In yesterday's post we talked about employer monopsony.  Relevant to this post is today's news about Washington state successfully suing to get fast food franchises to no longer enforce "no poaching" agreements.  The gist is:

The provisions prohibit workers at, for example, one Carl’s Jr. franchise from going to another Carl’s Jr. They do not stop those workers from taking jobs at restaurants run by a different chain.

While this does not lock workers into a single chain, it does make it harder for them to move around if one particular employment situation gets bad.  Any barriers to mobility tend to depress wages and thus the question of minimum wage as a policy.

It's true that tackling the bad policy might be a better overall decision.  But minimum wage is an easy to enforce policy that is hard to weasel around.  Once again, it is a policy that bears more looking at.

Jodi Beggs on employer monopsony power and mimumum wage

This is Joseph

Jodi Beggs has a great post on the minimum wage in the presence of employer monopsonies.  If there is only one buyer of market labor, that purchaser has a decided advantage.  Her main point of doing this analysis was to make the point that:

If a labor market is a monopsony (or if employers have monopsony power), minimum wages could actually increase rather than decrease employment.

She provides a number of worked examples, which are fun to look over.

What this made me wonder about the is the role of non-compete agreements in labor markets.  For example, there is a sandwich company that used to enforce non-compete agreements. Insofar as actors include these agreements in employment contracts, we might be closer to the point where minimum wages have a reduced cost (or even a benefit) to employment levels.  This is also likely to occur in high skill areas where the number of employers is small.  If you are a skilled airplane builder and live in Montreal, you will find limited employer options that are not Bombardier.  Moving has costs and, in the modern world, it isn't necessarily trivial to immigrate.

These effects may also occur in small markets, where the number of competing employers is limited, which is more of what Jodi Beggs was worrying about in her post.  In order for market forces to work properly, there are a number of key assumptions that are required.  There being multiple buyers of labor is one of these and we shouldn't be surprised if your intuitions are reversed in some markets.

Now how that works for things like the Seattle minimum wage are more complicated.  But this could be an important layer to understanding this as different studies had slightly different industries and it may be that employer diversity is confounding some of these associations.

But it is worth reflecting on as it makes the arguments against the minimum wage a lot weaker if there are market monopsonies present.  If so, then the policy benefits of this policy are actually pretty great.

(Jodi Beggs points to an article on the topic, and the evidence seems mixed, but not ignorable).

Another in our series of revolutionary postwar innovations – – let's go to the tape

With the advent of magnetic tape, audio recording changed more in a few years than it had in the previous few decades. For record producers and sound engineers, performances went from being something holistic that could only be presented as captured to being a collection of elements, each of which could be edited, tweaked, and recombined in infinite ways. Though digital technology has greatly increased the power and convenience of the sound engineer's toolbox, the basic paradigm is about 70 years old.

Though the effects took a bit longer videotape, the impact was arguably even greater. Though film remained the standard for situations where high picture quality had to be maintained, the ability to play back a recording immediately ("and now let's go to the instant replay") and the ability to reuse tape radically altered the business of video production and television news.

Here's a notable example of the new audio paradigm from CBS Radio Workshop.

The premiere broadcast was a two-part adaptation of Aldous Huxley's Brave New World, introduced and narrated by Huxley. It took a unique approach to sound effects, as described in a Time (February 6, 1956) review that week:

It took three radio sound men, a control-room engineer and five hours of hard work to create the sound that was heard for less than 30 seconds on the air. The sound consisted of a ticking metronome, tom-tom beats, bubbling water, air hose, cow moo, boing! (two types), oscillator, dripping water (two types) and three kinds of wine glasses clicking against each other. Judiciously blended and recorded on tape, the effect was still not quite right. Then the tape was played backward with a little echo added. That did it. The sound depicted the manufacturing of babies in the radio version of Aldous Huxley's Brave New World.

A few years earlier, Gunsmoke (a serious contender for best show ever in two different media) was noted for its detailed sound montages, including different effects for the pouring of beer and whiskey.

Interesting bit of trivia about the show. CBS chose to run the show unsponsored for the first few seasons. They wanted a genuinely adult Western and the producers were afraid advertisers would pressure them to lighten the program. If you listen to this episode, you'll understand why.

Back on the urbanist beat

The following video hits a couple of points we've been making over the years about urbanization and the creative class. The first is that utopian urbanists, while not without good ideas and an abundance of fine intentions, tend to operate under a hopelessly romanticized vision of urban living and that they often embrace policies that push reality even further from their own ideal.

If you're looking for a perfect Richard Florida style neighborhood, a place where a film director, a JPL rocket scientist, and a coder might run into each other and decide to have a coffee at a sidewalk café, you'd be hard pressed to find a better spot than this section of Burbank.

You can eat on the cheap (a small coffee and a big pastry at Portos can come in under three dollars). You can watch professional makeup artists comparing prosthetics for an indie horror film and costume designers sifting through the racks of a thrift store. You can see a first-rate play or improv comedy show, go to a book signing, or pick up some groceries in one of the delis.

This is very much in line with the lifestyle many utopian urbanists fantasize about, but unfortunately it can only exist in a fragile Goldilocks zone of just the right density and property values, and ironically, the more appealing a neighborhood like this is, the more factors that make it appealing are threatened.

High density, high traffic areas are really only suitable for two types of retail businesses, expensive and/or fast-turnover. Businesses where customers take their time and don't spend a lot of money cannot survive under these conditions.

Just to be clear, I'm not taking sides or advocating certain policies here. If this stretch of Magnolia is all chain stores in a couple of years, I probably won't hang out there but I won't begrudge the property owners for seeking optimal returns either. I simply want to point out that urbanists and the YIMBY movement may not have thought through the implications of some of their proposals and rhetoric.


Via Mark Evanier.

Media Post: The Last Jedi

This is Joseph.

Since the Last Jedi came out there have been a number of critiques of it; some better than others.  It is quite clear that the attempt to deconstruct the franchise, while artistically interesting, had some issues.  In particular, I would summarize my thoughts as:

Visuals: Stunning.  Simply stunning.  What a beautiful movie
Creativity: I may not love Canto Bight, but boy was it creative
Characters: Ok.  There is a break in continuity of character between movies, but it isn't fatal
Plot: Weak, very weak.

Probably my favorite review of it is this one.  The author lists eight critiques, of which I see #3 as being the most serious:

The primary plot (of the cruiser chase) is riddled with plot holes and doesn’t make any sense. The film suffers because its backbone is broken.

Now, it isn't the case that previous movies completely avoided these issues.  Compare with the Empire Strikes Back -- the asteroid chase has similar issues and while they are more clever about dialogue, the timeline is a mess.  And some characters had big changes -- Darth Vader seems much more important than he used to be, for example, and much less deferential to senior military commanders.

But the issue was the deconstruction, I think.  The writer-director played against type, which the Empire Strikes Back did not do (at least not so completely).  Now you can shake up a franchise, but this is a delicate matter that requires great skill.  Mark Evanier tells an anecdote about a junior writer asking Ray Bradbury if it was ok to be as high maintenance as Harlan Ellison.  The rejoinder was priceless:

"I don't know if that's okay but if you try it, check first and make sure you have the talents of a Harlan Ellison."

I think that this is exactly right.  If you want to subvert expectations then it should be in the service of creating a better or more thought provoking story.  This story was very well shot but needed a serious rewrite of the script and a goal as to how the subversion would make the story sing.

It was also easy in the franchise for this move.  Thor Skywalker points out that the Marvel Cinematic Universe is twenty movies in, with a fairly limited range of characters and plots, and hasn't felt the need to subvert expectations yet:

In fact his comparison of Thor Ragnorak, which is not a perfect movie by a long stretch, to the Last Jedi is quite clever.  Both movies are ultimately about failure.  They even both have the breaking of the protagonist's weapons, the loss of home, and the death of most of the protagonist's organization.   But one has a tighter script and more narrative payoffs.  The other has better visuals and more creativity.  Guess which one grossed higher.

Now it is true, I was cheering for Rey to date Finn and not a serial killer.  But I don't mind being wrong -- that is part of the fun.  Who would have guessed it would be Han and Leia?  Or that Darth Vader would be the one to defeat the emperor?  Or that Yoda actually fought Darth Sidious?  I like being surprised, so long as the surprise keeps the story fresh and interesting.


So my view: good movie, fabulous eye candy, great for kinds, but one that really needed a script doctor for the fans in the audience.

"Back when fifty years was a long time ago" -- updated with new video links

I realized that the Willoughby episode fit into the late 19th century time travel genre (As well as being a good example of how people in the early sixties felt about the pace of their own lives).



And the link on this one had gone dead.

Sunday, December 30, 2012

Back when fifty years was a long time ago

I've noticed over the past year or two that people ranging  from Neal Stephenson  to Paul Krugman have been increasingly open about the possibility that technological progress been under-performing lately (Tyler Cowen has also been making similar points for a while). David Graeber does perhaps the bst job summing up the position (though I could do without the title).

The case that recent progress has been anemic is often backed with comparisons to the advances of the late Nineteenth and early Twentieth Centuries (for example).  There are all sorts of technological and economic metrics that show the extent of these advances but you can also get some interesting insights looking at the way pop culture portrayed these changes.

Though much has been written pop culture attitudes toward technological change, almost all focus on forward-looking attitudes (what people thought the future would be like). This is problematic since science fiction authors routinely mix the serious with the fanciful, satiric and even the deliberately absurd. You may well get a better read by looking at how people in the middle of the Twentieth Century looked at their own recent progress.

In the middle of the century, particularly in the Forties, there was a great fascination with the Gay Nineties. It was a period in living memory and yet in many ways it seemed incredibly distant, socially, politically, economically, artistically and most of all, technologically. In 1945, much, if not most day-to-day life depended on devices and media that were either relatively new in 1890 or were yet to be invented.  Even relatively old tech like newspapers were radically different, employing advances in printing and photography and filled with Twentieth Century innovations like comic strips.

The Nineties genre was built around the audiences' self-awareness of how rapidly their world had changed and was changing. The world of these films was pleasantly alien, separated from the viewers by cataclysmic changes.

The comparison to Mad Men is useful. We have seen an uptick in interest in the world of fifty years ago but it's much smaller than the mid-Twentieth Century fascination with the Nineties and, more importantly, shows like Mad Men, Pan Am and the Playboy Club focused almost entirely on social mores. None of them had the sense of traveling to an alien place that you often get from Gay Nineties stories.

There was even a subgenre built around that idea, travelling literally or figuratively to the world of the Nineties. Literal travel could be via magic or even less convincing devices,
 
Figurative travel involved going to towns that had for some reason abandoned the Twentieth Century. Here's a representative 1946 example from Golden Age artist Klaus Nordling:

There are numerous other comics examples from the Forties, including this from one of the true geniuses of the medium, Jack Cole.

Images from 1896

From Scientific American 1896-11-14

This is important because it shows how people were thinking about phonographs and recorded media in general.

This is important because it illustrates the age's fascination with the massive.

This isn't important at all.

Fourth of July Americana from the great Jerry Goldsmith.

First, two great scores from two perfect little movies.









Next, two great scores from movies you could probably skip. (Howard Hawks should have stopped with El Dorado. He also should've hired Goldsmith for that one as well. With all due respect to Nelson Riddle, the score they ended up with pretty much sucks.)











And finally, a highly appropriate original composition.

Come to think of it, I'll bet we can find a venture capitalist who'll go for the discounted twenties plan

As bubbles go, the glut of video content is in many ways fairly benign. It means lots of work or people in the industry and a ton of often very good shows for viewers (so many that the main complaint is the inability to keep up). Furthermore, with the exception of Netflix (which may have some very unhappy investors at some point in the future), most of the money seems to be coming from companies with such deep pockets that a few billion here are there can go relatively unnoticed. Apple, for instance, could set up a line of street corner kiosks that sell $20 bills at 50% off and it still wouldn't make a dent in the company's profits.

But though the content bubble is probably nothing to get upset about, it is still worthy of study as an example of the mentality. In particular, this story nicely illustrates how the bubble mania and the fear of missing out of the next big thing creates its own kind of dream logic that overrides normal rational concerns.

As previously mentioned, even before the bubble the amount of content available was probably growing faster than the market, especially when we focus on the United States (more on that later). The introduction of smart phones and to a lesser degree tablets did significantly increase the potential hours of purview or consumption, but that was a one time bump and we are probably seeing it leveling off by now.

Content accumulates. It is true that programs tend to lose audience appeal with time, but the drop off is often quite slow. Numerous movies and TV shows maintain a shockingly stable viewership over the years. I Love Lucy and Perry Mason have maintained a following for over 60 years now. Blocks of MASH run on at least a half-dozen basic cable channels and show up in local syndication in pretty much every market. Some shows even have a resurgence. Golden Girls (no, I can't explain it either) has gone from obscure, to retro, to ironic, to genuinely cool, a status it didn't even achieve in its original run.

Even if the production of new programming had remained steady, there would be real concerns about oversupply, but instead it has exploded with more and more programs featuring bigger and bigger budgets. With each year, the unsustainability of the model has become increasingly obvious and yet the idea that you have to be producing your own content to survive has become an ever more closely held item of faith.

A couple of interesting assumptions get baked into these discussions. One is that you have to have your own content. The other is that the future of online video is the subscription all-you-can-the model. Both are highly suspect. As for the first, there is reason to believe that, while almost all of the hype and marketing center on the Netflix originals, much if not most of their viewership comes from licensing existing programs like blockbuster movies or old shows like the aforementioned Golden Girls.

As for the second, this is basically just the old cable TV bundling strategy (which everyone hates) dressed in 21st century drag. With both models, you are paying for programming you have no interest in ever watching. With streaming services, this has been momentarily obscured by a willingness to just break even or even lose money, but that is not likely to go on indefinitely.

The Apple programming slate suggest something close to peak bubble mentality. They are spending obscene amounts of money on big-name talent, most of which has extremely limited international appeal. They have no idea how these shows fit into their existing business plan. They have no need to be producing original content at all. They are doing this strictly because of the extraordinary popular delusion that not being part of this bubble will mean being left behind in the new economy.

From the Verge:

That’s an impressive roster, but it’s important to remember that Apple is building its catalog from the ground up. It has to catch up to streaming companies that have had years-long head starts and are currently producing hundreds of titles. And while we have dedicated platforms from heavy hitters like Amazon Prime, Hulu, and Netflix, as well as exclusive systems such as Stargate Command and CBS All Access, Apple has yet to announce exactly where any of these announced shows will debut.

The world's first photo booth

Another example for the point we've been making about how the period centering around the 1890s was marked not just by amazing technological advances that made headlines but also by smaller, more personal inventions and discoveries that permeated every aspect of people's lives.

For instance, getting a photograph taken was still an elaborate and expensive process in the early 1870s. 20 years later, it was something you paid a nickel for at the local arcade.

From Scientific American 1893-03-18

AUTOMATIC PHOTOGRAPHY.
Of all the many uses to which the automatic selling machine has been put, that of taking photographs seems the most remarkable. And yet this is what is being done now in several public places in New York and Brooklyn by means of a nickel-in-the-slot photograph machine recently patented by Mr. Pierre V. W. Welsh, of New York City. The operation, so far as relates to the exposure, development and fixing of the picture, is entirely automatic, and the little picture which the machine throws out, after a momentary washing, appears to be a marked success over previous efforts in this direction, as judged by the excellence of the work and the rapidity with which it is effected.

"The monster on your TV set"

I wish I knew the exact date on this one. I assume it's some time in the early to mid-70s, late enough that cable TV and services like HBO were clearly on the horizon, they still seemed like something that might be pushed back. I also suspect it was before or at best shortly after the multiplex model took hold.

Eventually, increasingly ginormous home video screens, mobile streaming, and other innovations will probably kill the movie theater as a mainstream venue, but I suspect the industry watchers of 50 or so years ago would have been surprised at how well the basic business model has held up.