Politics

Book review: Capital in the Twenty-First Century, by Thomas Piketty.

Capital in the Twenty-First Century is decent at history, mediocre at economics, unimpressive at forecasting, and gives policy advice that is thoughtfully adapted to his somewhat controversial goals. His goals involve a rather different set of priorities than I endorse, but the book mostly doesn’t try to persuade us to adopt his goals, so I won’t say much here about why I have different priorities.

That qualifies as a good deal less dumbed-down-for-popularity than I expected from a bestseller.

Even when he makes mistakes, he is often sufficiently thoughtful and clear to be somewhat entertaining.

Piketty provides a comprehensive view of changes in financial inequality since the start of the industrial revolution.

Piketty’s main story is that we’ve experienced moderately steady increases in inequality, as long as conditions remained somewhat normal. There was a big break in that trend associated with WW1, WW2, and to lesser extents the Great Depression and baby boom. Those equalizing forces (mainly decreases in wealth) seem unlikely to repeat. We’re back on a trend of increasing inequality, with no end in sight.

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Most Universal Basic Income (UBI) proposals look a bit implausible, because they want to solve poverty overnight, and rely on questionable hopes for how much taxpayers can be persuaded to support[1].

They also fall short of inspiring my idealistic motives, because they want to solve poverty only within the countries that implement the UBI (i.e. they should be called national basic income proposals). That means even those of us living in relatively successful countries would be gambling on the continued success of the country they happen to live in. I imagine some large upheavals in the next century or so that will create a good deal of uncertainty as to which countries prosper.

Political movements to create national basic income run the risk of being hijacked by political forces that are more short-sighted and less altruistic.

Whereas I’m more interested in preparing for the more distant risks of a large-scale technological unemployment that might accompany a large increase in economic growth.

UBI without taxation?

Manna is a somewhat better attempt. It’s a cryptocurrency with a one account per human rule, and regular distributions of additional (newly created) currency to each account.

It provides incentives to sign up (speaking of which, I get rewards if you sign up via this link). It’s less clear what incentive people have to hold onto their manna[2].

It’s designed so that, given optimistic assumptions, the price of manna will be stable, or maybe increase somewhat. Note that those optimistic assumptions include a significant amount of altruism on the part of many people.

Cryptocurrencies gained popularity in part because they offered a means of trust that was independent of their creator’s trustworthiness.

Manna doesn’t attempt to fully replicate that feature, because they’re not about to fully automate the one-human-one-account rule. They’ve outsourced a good deal of the verification to cell phone companies, but the system will still be vulnerable to fraud unless a good deal of human labor goes into limiting people to one account each.

The obvious outcome is that people stop buying manna, so it becomes worth too little for people to bother signing up.

I suspect most buying so far has been from people who think any cryptocurrency will go up. That’s typical of a bubble.

That may have helped to jumpstart the system, but I’m concerned that it may distract the founders from looking for a long-term solution.

Why use a cryptocurrency?

Some of what’s happening is that crypto enthusiasts expect crypto to solve all problems, and apply crypto to everything without looking for evidence that crypto is helpful to the problem at hand. The cryptocurrency bubble misled some people into thinking that cryptocurrencies created free lunches[3] (manna comes from heaven, right?), and a UBI is a good use for a free lunch.

I recommend instead that you think of manna as primarily a charity, which happens to get some advantage from using a cryptocurrency.

Cryptocurrencies provide fairly cheap ways of transmitting value.

The open source nature of the mechanism makes it relatively easy to verify most aspects of the system.

These may not sound like terribly strong reasons, but it looks to me like much of the difficulty in getting widespread adoption of valuable new charities is that donors won’t devote much effort to evaluating charities. So only the most easily verified charities succeed on their merits, and the rest succeed or fail mainly on their marketing ability.

Difficulties

It seems almost possible that the price of manna could be stable or rise reliably enough to act as a good store of value.

But it won’t happen via the thoughtless greed that drove last year’s cryptocurrency buying frenzy. It requires something along the lines of altruism and/or signaling.

It seems to require the “central bank” to use charitable donations to buy manna when the price of manna declines.

It also requires something unusual about the average person’s attitude toward manna. Would it be enough for people and businesses to accept manna as payment, for reasons that involve status signaling? That doesn’t seem quite enough.

It’s also important to persuade some people to hold the manna for a significant time.

Strategies

There’s little chance that can be accomplished by making manna look as safe as dollars or yuan. The only possibility that I can imagine working is if holdings of manna provide a good signal of wealth and wealth-related status. Manna seems to be positioned so that it could become a substitute for a fancy car or house as a signal of wealth. With that level of acceptance, it might provide a substitute for bank accounts as a store of value.

Signaling motives might also lead some upper-class people/businesses to use it as medium of exchange.

To work well, manna would probably need to be recognized as a charity, with a reputation that is almost as widely respected as the Red Cross. I.e. it would need to be a fairly standard form of altruism.

The main UBI movement wants to imagine they can solve poverty with one legislative act. Manna uses a more incremental approach, which provides less hope of solving poverty this decade, but maybe a bit more hope of mitigating larger problems from technological unemployment several decades from now.

Doubts?

Manna seems to be run by the first group of people who decided the idea was worth doing. Typically with a new technology, the people who will manage it most responsibly wait a few years before getting involved, so my priors are that I should hesitate before deciding this particular group is good enough.

Manna currently isn’t fair to people who can’t afford a cell phone, but if other aspects of manna succeed, it’s likely that cell phone companies will find a way to get cell phones to essentially everyone, since the manna will pay for the phones. Also, alternatives to cell phones will probably be implemented for manna access.

The high-level rhetoric says any human being is eligible for manna, but a closer look shows that anyone under 18 is treated as only partly qualified – manna accumulates in their name, and they get access to the manna when they come of age. The arbitrariness of this threshold is unsettling. We’ll get situations where people become parents, yet don’t have access to manna. Or maybe that’s not much of a problem because someone else will enable children to borrow, using their manna as collateral?

The problems will become harder if someone needs to figure out what qualifies a human being in an Age of Em, where uploaded minds (human, and maybe bonobo) can be quickly duplicated.

I’m not too clear on how the governing board will be chosen – they say something about voting, which sort of suggests a global democracy. That runs some risk of short-sighted people voting themselves more money now at the cost of a less stable system later. But the alternative governing mechanisms aren’t obviously great either.

I’d have more confidence if manna were focused exclusively on a UBI. But they want to also enable targeted donations, by providing verified age, gender, location, and occupation data, and “verified needy” status indications generated by other charities. Maybe a one or two of those would work out well, but I see some important tension between them and the “NO DISCRIMINATION” slogan on the home page.

The people in charge also want to solve “instability … resulting from too much money being held in too few hands and used for reckless financial speculation” without convincing me they understand what causes instability.

I’d be concerned about macroeconomic risks in the unlikely event that manna’s use became widespread enough that wages were denominated in it. Manna’s creators express Keynesian concerns about aggregate demand, suggesting that the best we could hope for from a manna monetary policy is that it would repeat the Fed’s occasional large mistakes. I’d prefer to aim for something better than that.

Current central banks have enough problems with promoting monetary stability. If they’re replaced by an organization which has a goal that’s more distinct from monetary stability, I expect monetary stability to suffer. I don’t consider it likely that manna will replace existing currencies enough for that to be a big concern, but I find this scenario hard to analyze.

Like most charities, it depends more on support from the wealthy than from the average person. Yet the rhetoric behind Manna seems designed to alienate the wealthy.

Is current People’s Currency Foundation sufficiently trustworthy? Or should someone create a better version?

I don’t know, and I don’t expect to do enough research to figure it out. Maybe OpenPhil can investigate enough?

Is this Effective Altruism?

The near-term benefits of Manna or something similar appear unimpressive compared to GiveDirectly, which targets beneficiaries in a more sophisticated (but less transparent?) way.

But Manna’s simpler criteria make it a bit more scaleable, and make it somewhat easier to gain widespread trust.

The main costs that I foresee involve the attention that is needed to shift people’s from charities such as the Red Cross or their alma mater as the default charity, toward manna. Plus, of course, whatever is lost from the charities who get fewer donations. There’s no shortage of charities that produce less value than a well-run UBI would, but the social pressure that I’m imagining is too blunt an instrument to carefully target the least valuable charities as the things that manna should replace.

Conclusion

I don’t recommend significant purchases of manna or donations to the People’s Currency Foundation now. Current efforts in this area should focus more on evaluating these ideas further, figuring out whether a good enough implementation exists, and if it should be scaled up, then we should focus more on generating widespread agreement that this is a good charity, and not focus much on near-term funding.

I give Manna a 0.5% chance of success, and I see an additional 1% chance that something similar will succeed. By success, I mean reliably providing enough income within 30 years so that at least 10 million of the world’s poorest people can use it to buy 2000 calories per day of food. That probability seems a bit higher than the chance that political action will similarly help the world’s poorest.

Footnotes

[1] – e.g. pointing to tax rates that were tolerated for a while after a world war, without noticing the hints that war played an important role in getting that toleration, and without noting how tax rates affect tax avoidance. See Piketty’s Capital in the Twenty-First Century, figures 13.1 and 14.1, for evidence that tax rates which are higher than current rates haven’t generated more revenues.

[2]Wikipedia says of the original manna: ‘Stored manna “bred worms and stank”‘.

[3] – or maybe the best cryptocurrencies do create free lunches, but people see more free lunches than are actually created. The majority of cryptocurrencies have been just transfers of money from suckers to savvy traders.

Book review: Warnings: Finding Cassandras to Stop Catastrophes, by Richard A. Clarke and R.P. Eddy.

This book is moderately addictive softcore version of outrage porn. Only small portions of the book attempt to describe how to recognize valuable warnings and ignore the rest. Large parts of the book seem written mainly to tell us which of the people portrayed in the book we should be outraged at, and which we should praise.

Normally I wouldn’t get around to finishing and reviewing a book containing this little information value, but this one was entertaining enough that I couldn’t stop.

The authors show above-average competence at selecting which warnings to investigate, but don’t convince me that they articulated how they accomplished that.

I’ll start with warnings on which I have the most expertise. I’ll focus a majority of my review on their advice for deciding which warnings matter, even though that may give the false impression that much of the book is about such advice.
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Book review: Inadequate Equilibria, by Eliezer Yudkowsky.

This book (actually halfway between a book and a series of blog posts) attacks the goal of epistemic modesty, which I’ll loosely summarize as reluctance to believe that one knows better than the average person.

1.

The book starts by focusing on the base rate for high-status institutions having harmful incentive structures, charting a middle ground between the excessive respect for those institutions that we see in mainstream sources, and the cynicism of most outsiders.

There’s a weak sense in which this is arrogant, namely that if were obvious to the average voter how to improve on these problems, then I’d expect the problems to be fixed. So people who claim to detect such problems ought to have decent evidence that they’re above average in the relevant skills. There are plenty of people who can rationally decide that applies to them. (Eliezer doubts that advising the rest to be modest will help; I suspect there are useful approaches to instilling modesty in people who should be more modest, but it’s not easy). Also, below-average people rarely seem to be attracted to Eliezer’s writings.

Later parts of the book focus on more personal choices, such as choosing a career.

Some parts of the book seem designed to show off Eliezer’s lack of need for modesty – sometimes successfully, sometimes leaving me suspecting he should be more modest (usually in ways that are somewhat orthogonal to his main points; i.e. his complaints about “reference class tennis” suggest overconfidence in his understanding of his debate opponents).

2.

Eliezer goes a bit overboard in attacking the outside view. He starts with legitimate complaints about people misusing it to justify rejecting theory and adopt “blind empiricism” (a mistake that I’ve occasionally made). But he partly rejects the advice that Tetlock gives in Superforecasting. I’m pretty sure Tetlock knows more about this domain than Eliezer does.

E.g. Eliezer says “But in novel situations where causal mechanisms differ, the outside view fails—there may not be relevantly similar cases, or it may be ambiguous which similar-looking cases are the right ones to look at.”, but Tetlock says ‘Nothing is 100% “unique” … So superforecasters conduct creative searches for comparison classes even for seemingly unique events’.

Compare Eliezer’s “But in many contexts, the outside view simply can’t compete with a good theory” with Tetlock’s commandment number 3 (“Strike the right balance between inside and outside views”). Eliezer seems to treat the approaches as antagonistic, whereas Tetlock advises us to find a synthesis in which the approaches cooperate.

3.

Eliezer provides a decent outline of what causes excess modesty. He classifies the two main failure modes as anxious underconfidence, and status regulation. Anxious underconfidence definitely sounds like something I’ve felt somewhat often, and status regulation seems pretty plausible, but harder for me to detect.

Eliezer presents a clear model of why status regulation exists, but his explanation for anxious underconfidence doesn’t seem complete. Here are some of my ideas about possible causes of anxious underconfidence:

  • People evaluate mistaken career choices and social rejection as if they meant death (which was roughly true until quite recently), so extreme risk aversion made sense;
  • Inaction (or choosing the default action) minimizes blame. If I carefully consider an option, my choice says more about my future actions than if I neglect to think about the option;
  • People often evaluate their success at life by counting the number of correct and incorrect decisions, rather than adding up the value produced;
  • People who don’t grok the Bayesian meaning of the word “evidence” are likely to privilege the scientific and legal meanings of evidence. So beliefs based on more subjective evidence get treated as second class citizens.

I suspect that most harm from excess modesty (and also arrogance) happens in evolutionarily novel contexts. Decisions such as creating a business plan for a startup, or writing a novel that sells a million copies, are sufficiently different from what we evolved to do that we should expect over/underconfidence to cause more harm.

4.

Another way to summarize the book would be: don’t aim to overcompensate for overconfidence; instead, aim to eliminate the causes of overconfidence.

This book will be moderately popular among Eliezer’s fans, but it seems unlikely to greatly expand his influence.

It didn’t convince me that epistemic modesty is generally harmful, but it does provide clues to identifying significant domains in which epistemic modesty causes important harm.

Book review: The Causes of War and the Spread of Peace: But Will War Rebound?, by Azar Gat.

This book provides a good synthesis of the best ideas about why wars happen.

It overlaps a good deal with Pinker’s The Better Angels of Our Nature. Pinker provides much more detailed evidence, but Gat has a much better understanding than Pinker of the theories behind the trends.
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Book review: Seasteading, by Joe Quirk, with Patri Friedman.

Seasteading is an interesting idea. Alas, Quirk’s approach is not quirky enough to do justice to the unusual advantages of seasteading.

The book’s style is too much like a newspaper. Rather than focus on the main advantages of seasteading, it focuses on the concerns of the average person, and on how seasteading might affect them. It quotes interesting people extensively, while being vague about whether the authors are just reporting that those people have ideas, or whether the authors have checked that the ideas are correct. Many of the ideas seem rather fishy.

I suspect that seasteading’s biggest need now is businessmen and/or VCs who can start cruise-ship-sized projects. Yet the book seems aimed more at creating broad, shallow support among ordinary readers than it is at inspiring competent entrepreneurs.
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This post is about the combined effects of cheap solar energy, batteries, and robocars.

Peak oil is coming soon, and will be at least as important as peak whale oil; probably more like peak horse.

First I noticed a good article on the future of fossil fuels by Colby Davis. Then I noticed a report on robocars by Rethinkx, which has some fairly strong arguments that Colby underestimates the speed of change. In particular, Colby describes “reasonable assumptions” as implying “Electric vehicles would make up a third of the market by 2035 and half by 2040”, whereas RethinkX convinced me to expect a 2035 market share of more like 99%.

tl;dr: electric robocars run by Uber-like companies will be cheap enough that you’ll have trouble giving away a car bought today. Uber’s prices will be less than your obsolete car’s costs of fuel, maintainance, and insurance.

As I was writing this post, a Chinese official talked about banning gas-based cars “in the near future” (timing not yet decided). If only I had bought shares in a lithium mining company before that news.

energy costs

Solar costs have dropped at a Moore’s law-like rate. See Swanson’s law.
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In this post, I’ll describe features of the moral system that I use. I expect that it’s similar enough to Robin Hanson’s views I’ll use his name dealism to describe it, but I haven’t seen a well-organized description of dealism. (See a partial description here).

It’s also pretty similar to the system that Drescher described in Good and Real, combined with Anna Salamon’s description of causal models for Newcomb’s problem (which describes how to replace Drescher’s confused notion of “subjunctive relations” with a causal model). Good and Real eloquently describes why people should want to follow dealist-like moral system; my post will be easier to understand if you understand Good and Real.

The most similar mainstream system is contractarianism. Dealism applies to a broader set of agents, and depends less on the initial conditions. I haven’t read enough about contractarianism to decide whether dealism is a special type of contractarianism or whether it should be classified as something separate. Gauthier’s writings look possibly relevant, but I haven’t found time to read them.

Scott Aaronson’s eigenmorality also overlaps a good deal with dealism, and is maybe a bit easier to understand.

Under dealism, morality consists of rules / agreements / deals, especially those that can be universalized. We become more civilized as we coordinate better to produce more cooperative deals. I’m being somewhat ambiguous about what “deal” and “universalized” mean, but those ambiguities don’t seem important to the major disagreements over moral systems, and I want to focus in this post on high-level disagreements.
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[Another underwhelming book; I promise to get out of the habit of posting only book reviews Real Soon Now.]

Book review: Seeing like a State: How Certain Schemes to Improve the Human Condition Have Failed, by James C. Scott.

Scott begins with a history of the tension between the desire for legibility versus the desire for local control. E.g. central governments wanted to know how much they could tax peasants without causing famine or revolt. Yet even in the optimistic case where they got an honest tax collector to report how many bushels of grain John produced, they had problems due to John’s village having an idiosyncratic meaning of “bushel” that the tax collector couldn’t easily translate to something the central government knew. And it was hard to keep track of whether John had paid the tax, since the central government didn’t understand how the villagers distinguished that John from the John who lived a mile away.

So governments that wanted to grow imposed lots of standards on people. That sometimes helped peasants by making their taxes fairer and more predictable, but often trampled over local arrangements that had worked well (especially complex land use agreements).

I found that part of the book to be a fairly nice explanation of why an important set of conflicts was nearly inevitable. Scott gives a relatively balanced view of how increased legibility had both good and bad effects (more efficient taxation, diseases tracked better, Nazis found more Jews, etc.).

Then Scott becomes more repetitive and one-sided when describing high modernism, which carried the desire for legibility to a revolutionary, authoritarian extreme (especially between 1920 and 1960). I didn’t want 250 pages of evidence that Soviet style central planning was often destructive. Maybe that conclusion wasn’t obvious to enough people when Scott started writing the book, but it was painfully obvious by the time the book was published.

Scott’s complaints resemble the Hayekian side of the socialist calculation debate, except that Scott frames in terms that minimize associations with socialism and capitalism. E.g. he manages to include Taylorist factory management in his cluster of bad ideas.

It’s interesting to compare Fukuyama’s description of Tanzania with Scott’s description. They both agree that villagization (Scott’s focus) was a disaster. Scott leaves readers with the impression that villagization was the most important policy, whereas Fukuyama only devotes one paragraph to it, and gives the impression that the overall effects of Tanzania’s legibility-increasing moves were beneficial (mainly via a common language causing more cooperation). Neither author provides a balanced view (but then they were both drawing attention to neglected aspects of history, not trying to provide a complete picture).

My advice: read the SlateStarCodex review, don’t read the whole book.