Risk Aversion

What is the average interest rate these days?  According to one source it is puny:

Throughout the entire industry, however, the national average bank interest rate for savings accounts is only .21 percent

So why might be it rational to overpay your taxes by a small amount?  Consider this comment from Megan McArdle:

A tax refund is not free money you get from the government. It’s free money you gave to the government—by overpaying your taxes all year. You think the interest rate on your savings account is paltry? At least it's not zero, which is the amount Uncle Sam pays you for your yearlong interest free loan. (If you underpay the government, on the other hand, they charge you not only interest, but also penalties.)

On one hand her advice is completely sensible.  It makes a lot of sense to reduce a very large tax refund.  On the other hand, you need to save a lot of money for the 0.21% interest in that savings account to outweigh the interest and penalties.  Since even interest is 3% (15 times the savings rate), I think it makes sense to aim for a small refund rather than to make errors on both sides of the distribution (since underpaying is much more expensive than the lost revenue from overpaying).  This logic may not hold if interest rates and/or inflation pick up in the future. 

Did Dickens meet Dostoevsky? -- Opinions differ

Ross MacDonald books often start with a family that seems perfect except for one element out of place (like an angry, disturbed child) but when the hero starts to tug on that one thread the entire illusion falls apart.

University of California Berkeley Prof. Eric Naiman has come close to the scholarly equivalent of a Ross MacDonald novel in his recent essay in the Times literary supplement (via LGM). He finds one thread out of place, in this case an unlikely meeting between two famous novelists.By tugging on that thread Naiman uncovers a hoax of truly incredible scale and complexity. (Literally incredible at first. I Googled a half dozen of Naiman's facts before I decided he wasn't the one playing games.)

You really need to read the whole thing for yourself but one section near the beginning was particularly relevant to some of our recent discussions.

Late in 2011, Michiko Kakutani opened her New York Times review of Claire Tomalin’s biography of Charles Dickens with “a remarkable account” she had found in its pages. In London for a few days in 1862, Fyodor Dostoevsky had dropped in on Dickens’s editorial offices and found the writer in an expansive mood. In a letter written by Dostoevsky to an old friend sixteen years later, the writer of so many great confession scenes depicted Dickens baring his creative soul:

“All the good simple people in his novels, Little Nell, even the holy simpletons like Barnaby Rudge, are what he wanted to have been, and his villains were what he was (or rather, what he found in himself), his cruelty, his attacks of causeless enmity toward those who were helpless and looked to him for comfort, his shrinking from those whom he ought to love, being used up in what he wrote. There were two people in him, he told me: one who feels as he ought to feel and one who feels the opposite. From the one who feels the opposite I make my evil characters, from the one who feels as a man ought to feel I try to live my life. ‘Only two people?’ I asked.”

I have been teaching courses on Dostoevsky for over two decades, but I had never come across any mention of this encounter. Although Dostoevsky is known to have visited London for a week in 1862, neither his published letters nor any of the numerous biographies contain any hint of such a meeting. Dostoevsky would have been a virtual unknown to Dickens. It isn’t clear why Dickens would have opened up to his Russian colleague in this manner, and even if he had wanted to, in what language would the two men have conversed? (It could only have been French, which should lead one to wonder about the eloquence of a remembered remark filtered through two foreign tongues.) Moreover, Dostoevsky was a prickly, often rude interlocutor. He and Turgenev hated each other. He never even met Tolstoy. Would he have sought Dickens out? Would he then have been silent about the encounter for so many years, when it would have provided such wonderful fodder for his polemical journalism?

Several American professors of Russian literature wrote to the New York Times in protest, and eventually a half-hearted online retraction was made, informing readers that the authenticity of the encounter had been called into question, but in the meantime a second review of Tomalin’s biography had appeared in the Times, citing the same passage. Now it was the novelist David Gates gushing that he would trade a pile of Dickens biographies for footage of that tête-à-tête. While agreeing with Tomalin’s characterization of this quotation as “Dickens’s most profound statement about his inner life”, he found its content less astonishing than she: “it’s only amazing because it’s the image-conscious Dickens himself coming out and saying what anybody familiar with his work and his life has always intuited”.

Shortly thereafter, the Times website appended to the online version of Gates’s review the same cautionary note that had already been attached to Kakutani’s. But on January 15, 2012, the paper’s “Sunday Observer” section published yet a third article on Dickens that quoted from Dostoevsky’s letter. (The same online disclaimer was soon appended to this piece as well.) The newspaper’s collective unconscious was unable to give the story up. It demands retelling, and by now Dickens and Dostoevsky can be found meeting all over the web. Their conversation appeals to our fancy while, as Gates realized, comforting us with a reaffirmation of what we already know. Moreover, this reassuring familiarity applies not only to Dickens, but also to Dostoevsky. The man who asks “Only two?” is a writer who already knows what Mikhail Bakhtin would eventually write about him, who is presciently aware of his late-twentieth-century canonization as the inventor of literary polyphony.

I wondered if Naiman was being overly harsh when he called the retraction 'half-hearted.' He wasn't:

Correction: October 29, 2011 

The Books of The Times review on Tuesday, about “Becoming Dickens: The Invention of a Novelist” by Robert Douglas-Fairhurst, and “Charles Dickens” by Claire Tomalin, recounted an anecdote in Ms. Tomalin’s book in which Dostoyevsky told of meeting Dickens. While others have also written of such a meeting and of a letter in which Dostoyevsky was said to have described it, some scholars have questioned the authenticity of the letter and whether the meeting ever occurred.

I know I've been harping on this but there's a big and important issue with modern journalism's indifference to getting the facts right. The difficulty involved in checking a story has decreased by orders of magnitude and yet, even at our best papers, Twenty-first Century reporting is often less accurate than Twentieth Century work. Part of the problem is he belief that you're in the clear when you publish something that obviously wrong if you later add a weaselly some-people-disagree disclaimer at the bottom.

But enough scolding. Go read the Naiman piece. You will not find anything else like it.

Coding boot camp

Interesting story both from an educational and labor-economics standpoint. More to come on this one.

From the AP:

Instead, he quit his job and spent his savings to enroll at Dev Bootcamp, a new San Francisco school that teaches students how to write software in nine weeks. The $11,000 gamble paid off: A week after he finished the program last summer, he landed an engineering job that paid more than twice his previous salary.   

“It’s the best decision I’ve made in my life,” said Shimizu, 24, who worked in marketing and public relations after graduating from the University of California, Berkeley in 2010. “I was really worried about getting a job, and it just happened like that.” Dev Bootcamp, which calls itself an “apprenticeship on steroids,” is one of a new breed of computer-programming school that’s proliferating in San Francisco and other U.S. tech hubs. These “hacker boot camps” promise to teach students how to write code in two or three months and help them get hired as web developers, with starting salaries between $80,000 and $100,000, often within days or weeks of graduation.

“We’re focused on extreme employability,” said Shereef Bishay, who co-founded Dev Bootcamp 15 months ago. “Every single skill you learn here you’ll apply on your first day on the job.”

These intensive training programs are not cheap — charging $10,000 to $15,000 for programs running nine to 12 weeks — and they’re highly selective, typically only admitting 10 to 20 percent of applicants. And they’re called boot camps for a reason. Students can expect to work 80 to 100 hours a week, mostly writing code in teams under the guidance of experienced software developers. “It’s quite grueling. They push you very hard,” said Eno Compton, 31, who finished Dev Bootcamp in late March. Compton is finishing his doctorate in Japanese literature at Princeton University, but decided he wants to be a software engineer instead of a professor.

Weekend blogging -- Geoffrey Lewis

It's always cool to discover unexpected talents in familiar figures, like the actor you've seen playing a hundred "blank-faced hicks" who turns out to know more about dialect than perhaps anyone in Hollywood.

Along similar lines, I'd always liked Geoffrey Lewis's amiable sidekicks, but it turns out he was just as well known in acting circles as an Oscar nominated monologuist.

The even more indefensible Michelle Rhee

USA Today's Greg Toppo drives what should be the final nail into the coffin of Michelle Rhee's reputation (via Esquire's Charles Pierce):

District of Columbia Public Schools officials have long maintained that a 2011 test-cheating scandal that generated two government probes was limited to one elementary school. But a newly uncovered confidential memo warns as far back as January 2009 that educator cheating on 2008 standardized tests could have been widespread, with 191 teachers in 70 schools "implicated in possible testing infractions."

The 2009 memo was written by an outside analyst, Fay "Sandy" Sanford, who had been invited by then-chancellor Michelle Rhee to examine students' irregular math and reading score gains. It was sent to Rhee's top deputy for accountability.

The memo notes that nearly all of the teachers at one Washington elementary school had students whose test papers showed high numbers of wrong-to-right erasures and asks, "Could a separate person have been responsible?"

It recommends that DCPS contact its legal department "as soon as you think it advisable" and ask them to determine "what possible actions can be taken against identified offenders."

DCPS officials have said they take all cheating allegations seriously, but it's not immediately clear how they responded to Sanford's warnings. Only one educator lost his job because of cheating, according to DCPS. Meanwhile, Rhee fired more than 600 teachers for low test scores — 241 of them in one day in 2010.

...

In a statement, Rhee said she didn't recall getting Sanford's memo: "As chancellor I received countless reports, memoranda and presentations. I don't recall receiving a report by Sandy Sanford regarding erasure data from the (DC Comprehensive Assessment System), but I'm pleased, as has been previously reported, that both inspectors general (DOE and DCPS) reviewed the memo and confirmed my belief that there was no widespread cheating."

If any of this seems surprising, you either haven't been following Rhee's career or... Well, that 'or' is a bit complicated. Rhee has always done things that seemed questionable (abuse of power, suspect claims, relentless self-promotion) but these disturbing points were largely omitted from coverage that often verged on hagiography. It was only after giving her full support to the country's most reactionary governors that her reputation started to fade.

Even with that a surprising number of otherwise intelligent journalists who have covered Rhee for years still manage to deny the undeniable.

S&W appreciation day

A message from the makers of Swords and Wizardry in celebration of S&W appreciation day (April 17th):

We would like to ask you each to announce to all your readers that we will be offering a 1 day only 25% off Swords & Wizardry sale. The coupon and information is optional to post on your blog of course: Frog God Games (http://www.talesofthefroggod.com/) and d20pfsrd.com Store will be offering a 25% off Swords & Wizardry products.  We will be sending out a coupon code before the event.

No member of this blog is affiliated with this company nor do we have any financial interest.  But if you were planning to check this this system anyway, it is not a bad time. 

Note that a lot of the game system material can be downloaded for free, in a handy word document for house rules development.

When I say my to-blog list is ever-growing...

Good ones from Dean Dad and Adam Kotsko.

Felix Salmon is one of those rare business journalists who actually understands business.

Ebert was an odd Paulette.

WSJ is waaaaay behind the LA Weekly. (and when you can't keep up with those guys you really need to think about a career change).

"Fox threatens to become cable channel amid Aereo dispute" -- lots to say on this one.

An interesting story (via The Story) about a reporter who visited the markers the census department uses to commemorate the spot of the population centroid. I wonder what the centroids of population subgroups (demographic, economic, political) look like and how they've shifted over the years.

Another case of economists seeing a paradox when the rest of us don't?

Climate change comes with bumpy rides.

And finally, the film Paul Krugman doesn't want you to see.

Free TV blogging -- suspicion confirmed

This was an AV club day. A musician friend needed some help digitizing various videos in various formats so we picked up an adapter at Fry's (after being told by four different salespeople that they didn't have it) and spent the rest of the afternoon cannibalizing cables and rearranging equipment. (Worked great, by the way.)

The adapter came with a very small antenna that allowed you to watch broadcast television on your PC (I tried it my laptop and got almost 100 channels). After we'd captured the video clips he needed, we decided to hook up the antenna to his new big screen TV and check out the results. There was a dedicated connection for over the air so you could switch back and forth two versions of the same network feed, one coming over the antenna, the other coming through the Time Warner digital cable box.

I had expected the picture quality to be indistinguishable but we both immediately noticed the difference. The broadcast signal, picked up through a small, cheap antenna that basically came as a extra with a hybrid TV stick, was clearly better than the picture Time Warner charged hundreds of dollars a year for.

This anecdote would be a good stepping-off point if you wanted to address some big questions like media consolidation, bundling (both of services and content), the hard lot of orphan technologies or the wretched state consumer reporting. For now though, I'm just going to leave it as an experiment for our viewers at home: if you have a television set made in the last five years and a set of rabbit ears made in the last fifty, plug the antenna coaxial into the jack marked AIR and see what you get. It takes very little time and it might end up saving you a few hundred dollars a year.

I'll be coming back to this...

From John Hechinger:

From 1993 to 2009, U.S. universities added bureaucrats 10 times faster than they added tenured faculty.

Stupid, horrible people are not interesting; intelligent, decent people doing stupid, horrible things are.

Some recent activity here at Stat Views has got me thinking about a fairly obvious distinction that still somehow has a way of getting lost

Most bloggers (myself included) spend a lot of time singling out someone for the idiotic or offensive. These posts are fun and the targets often have it coming but there are two things to remember (and God knows this applies to me as much as anyone):

1. It's not that difficult to find an idiot or jerk if you're really looking;

2. There is nothing particularly notable about an idiot acting stupid or a jerk acting obnoxious.

What's interesting and potentially important is when someone who's not at idiot acts like one (analogous arguments hold for jerks and scoundrels for the rest of this post). This isn't just a case of hating the sin and not the sinner; it's more a question of causal reasoning. When a stupid person does something stupid it requires no explanation but when an intelligent person does something stupid (or better yet, engages in a pattern of stupidity), it suggests that something happened to cause a deviation from the expected. That deviation begs a cause.

For example in the 2000 election coverage, the journalistic lapses mentioned previously are interesting because the journalists involved were both professional and highly respected and had risen to the top of a very competitive profession. If a group of high school reporters had propagated errors in a school election and had biased their coverage because of social cliques and because one candidate had given them small gifts and compliments that would not be of any real interest.

What made this interesting and, to use an often misused phrase, significant was the fact that given the initial assumptions we would normally make about these respected and experienced journalists, what we saw was extremely unlikely. So unlikely it demanded an explanation

In this case various social psych phenomena did fit what we observed. Authority figures within the journalistic click were strongly opposed to Gore. Reciprocation meant that Bush's special treatment of the press corps would be returned. Bush's likability relative to Gore meant that he was likely to receive preferential treatment. Social norming meant that these behaviors would be internalized and repeated

Just to spell things out, what's interesting here is the way that one hypothesis (the Washington press corps was professional and impartial) fit the data badly while another (social dynamics were influencing journalists) fit the data well.

Sometimes what's interesting is neither the person or the act but the reaction to it. For example there was nothing that out of the ordinary about Timothy Noah complaining about the boss who fired him, there was however something strange about the way Politico reacted to Noah's complaint

By the same token there's nothing particularly interesting about a high school student writing a sarcastic essay about the schools that rejected her application. What is interesting is the way that essay illustrates an anticipated reaction among people of a certain social class to changes in the way students are admitted to prestigious schools.

It's easy for the reader (and too often the writer) to lose sight of what's going on. If they rise above the look-at-the-moron humor, posts about stupidity generally need to be a kind of significance test. Start with the assumption that "complete idiots are rare" and seldom make it through demanding selection processes, then, if you are faced with extreme stupidity, ask yourself how likely it is that someone that dim would have reached his or her position. At a p value of around 0.01, it's time to start looking for alternative explanations.

[note: I tried something new with this post, dictating the first draft to my I-phone. I found if I spoke very slowly and enunciated every syllable, the results were acceptable though I did get a couple of odd errors like cherlist for journalist (and, yes, 'cherlist' is a new one on me). I believe I caught all of the Siri-isms but if you see a complete non sequitur, it was probably supposed to be something else.]

Why I remain skeptical about fully private health care

Austin Frakt:

But the problem here is far worse than that. A shockingly large proportion of hospitals could not even report a price when asked. That’s not true of very many other industries. Typically, when someone is ready to buy, someone else is prepared to offer a quote. Not being able to produce one is a very unusual market feature.
 

So not only do you have the problems of trying to comparison shop when the seller has an incentive to make the price hard to find.  You actually have to take a leap of faith and hope that the final price is reasonable -- a gamble that it is hard to imagine doing with other goods and services of the same price point as a hip replacement (the example Frakt was talking about above).

Would you drive a car off the lot in hopes that it was cheaper than expected? 

And how do you apply market pressure when you can't actually use competition to select prices? 

The ever growing to-blog list

Something on the optimal partitioning of time based on this from Neal Stephenson and John D. Cook.

Mental Floss lists sometimes look a bit too good to be true but this list of scientific accidents would be a nice starting place for a post on the importance of open-ended research.

It's just possible that video gamers are over-represented in online polls.

The final chapter the JCP saga? We've already covered this as a fitness landscape problem, now we can talk about the dubious record of the great man theory of business management.

A whole thread on this excellent piece by E.O. Wilson on how much math a scientist really needs and this follow-up by Paul Krugman on the role of intuition.

Swords and Wizardry

Long term readers may know that I am interested in Table top RPGs and Mark is actually a published game designer (Kruzno).  It has been a while since I did a gaming post but there is a fun movement afoot to honor a small publisher that has been putting out some high quality books.

Erik Tenkar, of Tenkar's Tavern blog seems to be the nexus of an appreciation day that has been gathering steam.  So if you want to see something different, drop by and say hi. 

Cohort effects

Kevin Drum has a nice piece about recent increases in social security disability. 
His main hypothesis should be quite familiar to epidemiologists: that the increase is benefits is largely driven by cohort effects (due to the aging of a large demographic bulge in the United States population). Given how closely current payouts match 1996 projections, that isn't an unreasonable stance.

There are some small upticks recently, but these could be due to marginal workers in the face of a lengthy recession. Workers who would normally be border-line might prefer to work (given that working has a very positive halo on self-image in American culture) but lose their jobs due to the general economic downturn.

Is this a problem?

Well, only if you have a plan to employ 57-year olds with degenerative disk disease, or similar mobility restricting conditions. Otherwise, what really is the point of targeting this group at this time?

Obesity, genes and environment

Via Thomas Lumley:

In fact, just about the only completely uncontroversial fact about the increase in obesity is that it is entirely due to environmental changes of some sort. There’s disagreement on precisely which environmental changes, and on the likely public health impact, but not on the general principle. The reason is very simple: the genes of this generation’s children came from their parents, with almost no changes. There simply hasn’t been enough time for genetic differences to contribute.
 

This is absolutely correct.  Now it is possible that some genes make particular individuals more susceptible to particular environment insults.  But then it is unclear what the "cause" of the epidemic is: the susceptibility or the actual exposure.  In infectious diseases we are quite clear that some people are immune to some infectious diseases.  But if a particular individual becomes sick with a disease, it makes a lot more sense to blame the pathogen and not the genetic vulnerability of the person.

So when we see such a huge change in the prevalence of a chronic disease (like obesity) it makes a lot more sense to ask what is the underlying exposure.  In the same sense, I am unimpressed with arguments from things like self-discipline.  It is more probable that the current generation is more dissolute than the preceding one, but it seems unlikely that you are uniquely dissolute from a historical perspective.