A Philosopher's Blog

Making Government Like a Business: Skills & Methods

Posted in Business, Philosophy, Politics by Michael LaBossiere on March 29, 2017

President Trump assigned his son-in-law Jared Kushner to head up the effort to make the federal government more like a business. Trump has already been a leader in this effort by engaging in the same sort of nepotism that occurs in business. While it is certainly tempting to dismiss this appointment as more nepotism, it is worth considering whether government should be more like a business.

The idea that government should be more like a business is certainly appealing to those who education, experience and values relate to business. It is natural for people to see the world through the lens of their experiences and education. It is also natural to want to apply the methods that one is most familiar with to as many areas as possible. For example, my education is in philosophy and I have extensive experience in critical thinking, logic and ethical reasoning. As such, I tend to see the world through the philosophical lens and I want to apply critical thinking, logic and ethical reasoning whenever I can. Likewise, those who are educated and experienced in business see the world through the business lens and wish to broadly apply their business skills and methods.

A reasonable case can be made as to why this business focused approach has some merit. One way to argue for this is to point out that many skills that are developed in the context of business can be applied to government. For example, negotiating and deal making skills can be applied to politics—although there are certainly differences between the specifics of each area. As another example, business leadership and management skills can also be applied in government, although there are clearly relevant differences between the two areas. It would thus be a mistake to claim that government is nothing like a business. That said, those enamored of business often make mistakes in their zeal to “businessform” government (that is, transform it into business).

One basic mistake is to think that just because there are positive qualities of business that are also positive qualities of government, making government more like a business will bring about those positive qualities. Obviously enough, making one thing more like another only results in positive qualities if they are made alike in those positive ways. Merely making them alike in other ways does not do this. To use an analogy, dressing like a runner makes one like a runner, but this does not confer the health benefits of running.

There is also the fact that although things that have similar positive qualities are thus similar, it does not follow that they are thus otherwise alike in relevant ways. For example, efficiency is a positive quality of business and government, but merely making government like business need not make it more efficient. There are, after all, business that are very inefficient.

Also, the fact that efficiency can be a positive quality of both business and government does not entail they are thus alike in other ways or that the way business is made more efficient is the way to make government more efficient. To illustrate, a business might be very efficient at exploiting customers and workers while enriching the stockholders, but that is presumably not the sort of efficiency one would aim for in government.

Avoiding this mistake involves resisting the mythology and fetishizing of “businessifictaion” and giving due consideration to which skills, methods and approaches transfer well from business to government and which do not.

A second basic mistake is similar to that made by Ion in Plato’s dialogue Ion. The rhapsode Ion believes, at the start of the dialogue, that poets have knowledge and mastery about almost everything. His reasoning is that because poets write about, for example military matters, they have an expertise in military matters. As such, poets should be able to teach people about these matters and serve as leaders in all these areas.

Socrates, as would be expected, shows that the poets (as poets) do not have such knowledge. The gist of his argument is that each area is mastered by mastering the subject of that area and all these areas “belong” to others and not to the poets. For example, knowledge of waging war belongs to soldiers. The poets touch but lightly on these other areas and understand only the appearances and not the depth. Socrates does note that a person can have multiple domains of mastery, so a medical doctor could, for example, also be skilled at mathematics or art history.

The error in the case of business is to think that because there are many types of business and almost everything has some connection to business, then an alleged mastery of business confers mastery over all these things. However, business skills are rather distinct from the skills that are specific to the various types of businesses. To illustrate, while a manager might believe that their managing skills are universal, managing a software company does not confer software skills nor does managing a hospital confer medical skills. One might pick up skills and knowledge, but this would not be as a businessperson. After all, while a business person might be a runner, that does not make running a business. The fact that there are businesses associated with running, such as Nike, does not entail that skill in business thus confers skill in running. As such, for someone to think that business skills thus confer mastery over government would be a mistake. They might believe that they have such mastery because government interacts with business and some businesses do things like what government does, but they would be as mistaken as someone who thinks that because they manage a Nike outlet they are thus an athlete.

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Charter Schools IV: Profit

Posted in Business, Ethics, Politics by Michael LaBossiere on January 13, 2017

While being a charter school is distinct from being a for-profit school, one argument in favor of charter schools is because they, unlike public schools, can operate as for-profit businesses. While some might be tempted to assume a for-profit charter school must automatically be bad, it is worth considering this argument.

As one would suspect, the arguments in favor of for-profit charter schools are essentially the same as arguments in favor of providing public money to any for-profit business. While I cannot consider all of them in this short essay, I will present and assess some of them.

One stock argument is the efficiency argument. The idea is that for-profit charter schools have a greater incentive than non-profit schools to be efficient. This is because every increase in efficiency can yield an increase in profits. For example, if a for-profit charter school can offer school lunches at a lower cost than a public school, then the school can turn that difference into a profit. In contrast. A public school has less incentive to be efficient, since there is no profit to be made.

While this argument is reasonable, it can be countered. One obvious concern is that profits can also be increased by cutting costs in ways that are detrimental to the students and employees of the school. For example, the “efficiency” of lower cost school lunches could result from providing the students with less or lower quality food. As another example, a school could not offer essential, but expensive services for students with special needs. As a final example, employee positions and pay could be reduced to detrimental levels.

Another counter is that while public schools lack the profit motive, they still need to accomplish the required tasks with limited funds. As such, they also need to be efficient. In fact, they often must be very creative with extremely limited resources (and teachers routinely spend their own money purchasing supplies for the students). For-profit charter schools must do what public schools do, but must also make a profit—as such, for-profit schools would cost the public more for the same services and thus be less cost effective.

It could be objected that for-profit schools are inherently more efficient than public schools and hence they can make a profit and do all that a public school would do, for the same money or even less. To support this, proponents of for-profit education point to various incidents of badly run public schools.

The easy and obvious reply is that such problems do not arise because the schools are public, they arise because of bad management and other problems. There are many public schools that are well run and there are many for-profit operations that are badly run. As such, merely being for-profit will not make a charter school better than a public school.

A second stock argument in favor of for-profit charter schools is based on the idea competition improves quality. While students go to public school by default, for-profit charter schools must compete for students with public schools, private schools and other charter schools. Since parents generally look for the best school for their children, the highest quality for-profit charter schools will win the competition. As such, the for-profits have an incentive that public schools lack and thus will be better schools.

One obvious concern is that for-profits can get students without being of better quality. They could do so by extensive advertising, by exploiting political connections and various other ways that have nothing to do with quality.

Another concern about making the education of children a competitive business venture is that this competition has causalities: businesses go out of business. While the local hardware store going out of business is unfortunate, having an entire school go out of business would be worse. If a for-profit school goes out of business, there would be considerable disruption to the children and to the schools that would have to accept them. There is also the usual concern that the initial competition will result in a few (or one) for-profit emerging victorious and then settling into the usual pattern of lower quality and higher costs. Think, for example, of cable/internet companies. As such, the competition argument is not as strong as some might believe.

Those who disagree with me might contend that my arguments are mere speculation and that for-profit charter schools should be given a chance. They might turn out to be everything their proponents claim they will be.

While this is a reasonable point, it can be countered by considering the examples presented by other ventures in which for-profit versions of public institutions receive public money. Since there is a school to prison pipeline, it seems relevant to consider the example of for profit prisons.

The arguments in favor of for-profit prisons were like those considered above: for-profit prisons would be more efficient and have higher quality than prisons run by the state. Not surprisingly, to make more profits, many prisons cut staff, pay very low salaries, cut important services and so on. By making incarceration even more of a business, the imprisonment of citizens was incentivized with the expected results of more people being imprisoned for longer sentences. As such, for-profit prisons turned out to be disastrous for the prisoners and the public. While schools are different from prisons, it is easy enough to see the same sort of thing play out with for-profit charter schools.

The best and most obvious analogy is, of course, to the for-profit colleges. As with prisons and charter schools, the usual arguments about efficiency and quality were advanced to allow public money to go to for-profit institutes. The results were not surprising: for profit colleges proved to be disastrous for the students and the public. Far from being more efficient that public and non-profit colleges, the for-profits generally turned out to be significantly more expensive. They also tend to have significantly worse graduation and job placement rates than public and non-profit private schools. Students also accrue far more debt and make significant less money relative to public and private school students. These schools also sometimes go out of business, leaving students abandoned and often with useless credits that cannot transfer. They do, however, often excel at advertising—which explains how they lure in so many students when there are vastly better alternatives.

The public also literally paid the price—the for-profits receive a disproportionate amount of public money and students take out more student loans to pay for these schools and default on them more often. Far from being models of efficiency and quality, the for-profit colleges have often turned out to be little more than machines for turning public money into profits for a few. This is not to say that for-profit charter schools must become exploitation engines as well, but the disaster of for-profit colleges must be taken as a cautionary tale. While there are some who see our children as another resource to be exploited for profits, we should not allow this to happen.

 

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Charter Schools II: Choice & Quality

Posted in Business, Philosophy, Universities & Colleges by Michael LaBossiere on January 9, 2017

In the previous essay on charter schools I considered the monopoly argument in their favor. On this view, charter schools break the state’s harmful monopoly on education and this is a good thing. It is worth noting, again, that the state does not have a monopoly on education (there are private, non-charter schools). Instead, the state schools often have a monopoly on public money and charter schools break this monopoly by receiving public money. This, it is argued by charter school proponents, allows for more choice. They are quite right. But not all choices are good choices.

Without charter schools, people face rather limited alternatives to the public-school system. One is home schooling. While this does appeal to some people, it does limit the educational experience and requires a great deal of the parent(s). Another is attending a private school. While these schools can provide excellent education, they can very expensive. As such, they are an option only for those who can afford them. Because charter schools receive public money, they can provide an alternative to public schools for those who cannot afford a private school. However, there is the question of why there should be such choice and why people would take it.

One reason often given in favor of charter schools over public schools is that charter schools are supposed to superior in terms of the education they provide (or in some other relevant way). Proponents of charter schools point to failing public schools as evidence for this claim. While this is certainly a rational argument, there are some concerns with it.

One concern is that while there are bad public schools and excellent charter schools, there are also excellent public schools and awful charter schools. As such, there is nothing intrinsic to the public system that necessitates its badness nor anything intrinsic to the charter system that necessitates its superiority. This raises the question about what causes school quality.

The easy and obvious answer is that the main cause is funding. It is no accident that the best schools tend to be in affluent neighborhoods and the worst schools tend to be in poor areas. After all, a significant portion of the funding for public schools is local and is often based on property taxes. As such, high value property generates more funding for schools. Low value property generates far less. Naturally, this is not the whole story for school funding, but it is an important part. It is also worth noting that not just community wealth is a factor—community health is also important for the quality of education. After all, stable communities that have families actively involved in the school can create a very good educational experience for the children. However, wealth and health often travel hand in hand.

As might be suspected, most parents would prefer their children attend the best schools—this is why parents who have the income buy houses in the best school districts. This provides another limit to choice: while anyone can attend the best public schools, they must be able to afford to live in the district. This makes the best public schools analogous to private schools; one must pay to be able to attend. The promise of charter schools is that children can escape the poor schools and go to a superior charter school, using public money.

While this does have some appeal, there are some obvious problems. One is that the poor schools will become poorer as they lose students and will presumably decline even more until only those who cannot escape remain. This would seem to be like pouring money into lifeboats for an ailing ship rather than using the money to fix it.

Of course, this analogy could be countered by saying that the public school ship is doomed and the only viable option is escape. This is a reasonable counter—if a school is so badly wrecked that it cannot be saved, then escaping to another school would be as sensible as fleeing a sinking ship. The challenge is, however, showing that this should be a charter school and not a new public school.

Another is that it would seem to make more sense to use the public money to improve the public school so that parents would want their children to attend. After all, if parents want to choose good schools, the best use of public money would seem to be to make public schools better. Since there are excellent public schools, this is clearly something that can be done with proper funding and a strong community. As noted above, there is no special magic to charters that makes them inherently better than public schools. To use another analogy, the charter school argument is like pointing to the poorly maintained roads of a community and saying that the solution is not to fix the roads, but to use the public money to put in another set of roads adjacent to the existing roads. It would seem to make much more sense to fix the existing public roads rather than putting in “charter roads.”

In light of the above discussion, the choice argument for charter schools based on quality does not appear compelling. Unless it can be shown that charter schools are inherently better than public schools in virtue of being charters, then it would be more sensible to improve the quality of existing public schools rather than siphoning away public money. There are, however, other matters of choice beyond quality. In the next essay I will look at the appeal of ideological choice—charter schools that offer an ideological or theological alternative to public schools.

 

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The State & Business

Posted in Business, Ethics, Philosophy by Michael LaBossiere on December 19, 2016

The American anarchist Henry David Thoreau presents what has become a popular conservative view of the effect of government upon business: “Yet this government never of itself furthered any enterprise, but by the alacrity with which it got out of its way…Trade and commerce, if they were not made of India-rubber, would never manage to bounce over obstacles which legislators are continually putting in their way…”

While this sort of laissez faire view of the role of the state in business is often taken as gospel, there is the question of whether Thoreau is right. While I do find his anarchism appealing, there are some problems with his view.

Thoreau is quite right that the government can be employed to thwart and impede enterprises—this is often done by granting special advantages and subsidies to certain companies or industries, thus impeding their competitors. However, he is mistaken in his claim that the government has never “furthered any enterprise.” I will begin with the easy and obvious reply to this claim.

Modern business could not exist without the physical and social infrastructure provided by the state. In terms of the physical infrastructure, businesses need the transportation infrastructure provided by the state. The most obvious aspect of this infrastructure is the system of roads that is paid for by the citizens and maintained by the government (that is, the citizens acting collectively). Without such roads, most businesses could not operate—products could not be moved effectively and customers would be hard pressed to reach the businesses.

Perhaps even more critical than the physical infrastructure is the social infrastructure that is created by the government (that is, the people acting collectively and through officials). The social infrastructure includes the legal system, laws, police services, military services, diplomatic services and so on for the structures that compose the governmental aspects of society.

For example, companies in the intellectual property business (which ranges from those dealing in the arts to pharmaceutical companies) require the existence of the legal system and law enforcement. After all, if the state did not enforce the drug patents, the business model of the major pharmaceutical companies would be destroyed.

As another example, companies that do business internationally require the government’s military and diplomatic services to enable their business activities. In some cases, this involves the explicit use of the military in the service of business. In other cases, it is the gentler hand of diplomacy that advances American business around the world.

All businesses rely on the currency system made possible by the state and they are all protected by the police. While there are non-state currencies (such as bitcoin) and companies can hire mercenaries; these options are generally not viable for most businesses.  All of this seems to clearly show that the state plays a critical role in allowing business to exist. This can, however, be countered.

It could be argued that while the state is necessary for business (after all, there is little in the way of business in the state of nature), it does nothing else beyond that and should just get out of the way to avoid impeding business. To use an analogy, someone must build the stadium for the football game, but they need to get out of the way when it is time for the players to play. The obvious reply to this is to show how the state has played a very positive role in the development of business.

The United States has made a practice of subsidizing and supporting what have been regarded as key businesses. In the 1800s, the railroads were developed with the assistance of the state. The development of the oil industry depended on the state, as did the development of modern agriculture. It could, of course, be objected that this subsidizing and support are bad things—but they are certainly not bad for the businesses that benefit.

Another area where the state has helped advance business is in funding and engaging in research. This is often research that would be too expensive for private industry and research that requires a long time to yield benefits. One example of this is the development of space technology that made everything involving satellites possible. Another example is the development of the internet—which is the nervous system of the modern economy. The BBC’s “50 Things that Made the Modern Economy” does an excellent analysis of the role of governments in developing the technology that made the iPhone possible (and all smart phones).

One reason the United States has been so successful in the modern economy has been the past commitment of public money to basic research. While not all research leads to successful commercial applications (such as computers), the ability of the collective (us acting as the state) to support long term and expensive research has been critical to the advancement of technology and civilization.

This is not to take away from private sector research, but much of it is built upon public sector foundations. As would be expected, private sector research now tends to focus on short term profits rather than long term research. Unfortunately, this view has infected the public sector as well—as public money for research is reduced, public institutions seek private money and this money often comes with strings and the risk of corruption. For example, “research” might be funded to “prove” that a product is safe or effective. While this does yield short term gains, it will lead to a long-term disaster.

The state also helps further enterprise through laws regulating business. While this might seem like a paradox, it is easily shown by using an analogy to the role of the state in regulating the behavior of citizens.

Allowing business to operate with no regulation would be like allowing individuals to operate without regulations. While this might seem appealing, for an individual to further their life, they need protections from others who might threaten their life, liberty and property. To this end, laws are created and enforced to protect people. The same applies to protecting businesses from other businesses (and businesses from people and people from businesses). This is, of course, the stock argument for having government rather than the unregulated state of nature. As Hobbes noted, a lack of government can become a war of all against all and this ends badly for everyone. The freer the market gets, the closer it gets to this state of nature—a point well worth remembering.

It might be assumed that I foolishly think that all government involvement in business is good and that all regulation is desirable. This is not the case. Governments can wreck their own economies through corruption, bad regulations and other failures. Regulations are like any law—they can be good or bad, depending on what they achieve. Some regulations, such as those that encourage fair competition in business, are good. Others, such as those that grant certain companies unfair legal and financial advantages (you might be thinking of Monsanto here), are not.

While rhetorical bumper stickers about government, business and regulation are appealing in a simplistic way, the reality of the situation requires more thought and due consideration of the positive role the state can play—with due vigilance against the harms that it can do.

 

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Wells Fargo & Financial Crimes

Posted in Business, Ethics, Law, Philosophy by Michael LaBossiere on September 30, 2016

The venerable Wells Fargo bank made the news in 2016 for financial misdeeds on a massive scale. Employees of the company, in an effort to meet the quotas set by management, had created numerous accounts without the permission of the clients. In response over 5,300 lower level employees were fired. Initially, CEO John Stumpf and former head of retail banking Carrie Tolstedt were to keep their rather sizable compensation for leading the company to a great financial “success” based on this fraud. However, backlash from the public and the shareholders has resulted in Stumpf and Carrie losing some of their financial compensation.

As would be expected, there are currently no plans for criminal charges of the sort that could result in jail time. This is consistent with how financial misdeeds by the elites are typically handled: some fines and, at worst, some forfeiture of ill-gotten gains. While I do not generally agree with Trump, he is not wrong when he points out that the system is rigged in favor of the elites and against the common people. The fact that Trump is one of the elite and has used the system quite effectively does not prove him wrong (that would be fallacious reasoning); rather he himself serves as more evidence for the rigging. Those who loath Hillary Clinton can also add their own favorite examples.

It is instructive to compare the punishment for other misdeeds to those imposed on Wells Fargo. Shoplifting is usually seem as a fairly minor crime,  but a person who shoplifts property with a combined value of less than $300 can pay a fine up to $1000 or be sentenced to up to a year in jail. Shoplifting property with a combined value over $300 is a felony and can result in a sentence between one and ten years in jail. While Wells Fargo did not seem to directly steal money (that is, it did not simply empty accounts into its own coffers), it did rob people through the use of fees and other charges that arose from the creation of these unauthorized accounts.

While there are clearly differences between the direct theft of shoplifting and the indirect robbery of imposing charges on unauthorized accounts, there seems to be little moral distinction: after all, both are means of robbing someone of their rightful property.  Because of this, there would appear to be a need to revise the penalties so that they are properly proportional.

One option is to bring the punishment for major financial misdeeds in line with the punishment for shoplifting. This would involve changing the fine for financial misdeeds from being a fraction of the profits (or damages) of the misdeeds to a multiple of the profits (perhaps three or more times greater). It could be argued that such a harsh penalty could financial ruin an elite who lacked adequate assets to pay for their misdeed; however, the exact same argument can be advanced for poor shoplifters.

Another option is to bring the punishments for shoplifting in line with the punishments for the financial elites. This would change the fine for shoplifting from likely being in excess of the value of what was stolen to a fraction of what was stolen (if that). The obvious objection to this proposal is that if shoplifters knew that their punishment would be to pay a fraction of the value they had stolen, then this punishment would have no deterrent value. Shoplifting would be, in effect, shopping at a significant discount. It is thus hardly shocking that the financial elite are generally not deterred by the present system of punishment—they come out way ahead if they do not get caught and can still do very well even if they are caught.

It could be objected that the financial elite would be deterred on the grounds that they would still be better off using legal means to profit. That way they would keep 100% of their gain rather than a fraction. The easy and obvious reply is that this deterrent value is contingent on the elite believing that the legal approach would be more profitable than the illegal approach (with due consideration to the chance of getting caught and fined). Since the punishment is often a fraction of the gain and the potential gain from misdeeds can be huge, this approach to punishment has far less deterrent value than a punishment in which the punished comes out at a loss rather than a gain.

It is also interesting to compare the punishment for identity theft and fraud with the punishment of Wells Fargo. Conviction of identity theft can result in a sentence of one to seven years. Fraud charges also have sentences that range from one to ten years and beyond. While some do emphasize that Wells Fargo was not engaged in traditional identity theft was morally similar. As an example of traditional identity theft, a thief steals a person’s identity and gets a credit card under that name to use for their own gain. What Wells Fargo did was open accounts in people’s names without their permission so that the company could profit from this misuse of their identity. As such, the company was stealing from these people and doing them the same sorts of harms inflicted by individuals engaging in identity theft.

From a moral standpoint, those involved in these actions should face the same criminal charges and potential punishments that individuals acting on their own would face. This is morally required for consistency. Obviously enough, the laws are not consistent—the misdeeds of the elite and corporations are so often punished lightly or not at all. This is nothing new—the history of law is also the history of its unfair application. The injustice of justice, one might say.  However, this approach is problematic.

Looked at from a certain moral perspective, the degree to which I am obligated to accept punishment for my misdeeds is proportional to the consistency and fairness of the system of justice. If others are able to walk away from the consequences of their misdeeds or enjoy light punishments for misdeeds that would result in harsh penalties for me, then I have little moral reason to willingly accept any punishments that might be inflicted on me. Naturally, the state has the power to inflict its punishments whether I accept them or not, but it seems important to a system of justice that the citizens accept the moral legitimacy of the punishment.

To use an analogy, imagine a professor who ran their class like the justice system is run. If an elite student cheated and got an initial grade of 100, they might be punished by having the grade docked to an 80 if caught. In contrast, the common students would be failed and sent before the academic misconduct board for such a misdeed. The common students who cheated would be right to rebel against this system and refuse to accept such punishments—though they did wrong, justice without consistency is but a mockery of real justice.

In light of this discussion, Wells Fargo is yet another shining example of the inherent injustice and inequality in the legal system. If we wish to have a just system of justice, these disparities must be addressed. These disparities also warrant moral disobedience in the face of punishment. Why should, morally, a shoplifter accept a fine that vastly exceeds what they stole when a financial elite can pay but a fraction of their theft and profit well from their misdeeds?

 

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Automated Trucking

Posted in Business, Ethics, Philosophy, Science, Technology by Michael LaBossiere on September 23, 2016

Having grown up in the golden age of the CB radio, I have many fond memories of movies about truck driving heroes played by the likes of Kurt Russell and Clint Eastwood. While such movies seem to have been a passing phase, real truck drivers are heroes of the American economy. In addition to moving stuff across this great nation, they also earn solid wages and thus also contribute as taxpayers and consumers.

While most of the media attention is on self-driving cars, there are also plans underway to develop self-driving trucks. The steps towards automation will initially be a boon to truck drivers as these technological advances manifest as safety features. This progress will most likely lead to a truck with a human riding in the can as a backup (more for the psychological need of the public than any actual safety increase) and eventually to a fully automated truck.

Looked at in terms of the consequences of full automation, there will be many positive impacts. While the automated trucks will probably be more expensive than manned vehicles initially, not need to pay drivers will result in considerable savings for the companies. Some of this might even be passed on to consumers, resulting in a tiny decrease in some prices. There is also the fact that automated trucks, unlike human drivers, would not get tired, bored or distracted. While there will still be accidents involving these trucks, it would be reasonable to expect a very significant decrease. Such trucks would also be able to operate around the clock, stopping only to load/unload cargo, to refuel and for maintenance. This could increase the speed of deliveries. One can even imagine an automated truck with its own drones that fly away from the truck as it cruises the highway, making deliveries for companies like Amazon. While these will be good things, there will also be negative consequences.

The most obvious negative consequence of full automation is the elimination of trucker jobs. Currently, there are about 3.5 million drivers in the United States. There are also about 8.7 million other people employed in the trucking industry who do not drive. One must also remember all the people indirectly associated with trucking, ranging from people cooking meals for truckers to folks manufacturing or selling products for truckers. Finally, there are also the other economic impacts from the loss of these jobs, ranging from the loss of tax revenues to lost business. After all, truckers do not just buy truck related goods and services.

While the loss of jobs will be a negative impact, it should be noted that the transition from manned trucks to robot rigs will not occur overnight. There will be a slow transition as the technology is adopted and it is certain that there will be several years in which human truckers and robotruckers share the roads. This can allow for a planned transition that will mitigate the economic shock. That said, there will presumably come a day when drivers are given their pink slips in large numbers and lose their jobs to the rolling robots. Since economic transitions resulting from technological changes are nothing new, it could be hoped that this transition would be managed in a way that mitigated the harm to those impacted.

It is also worth considering that the switch to automated trucking will, as technological changes almost always do, create new jobs and modify old ones. The trucks will still need to be manufactured, managed and maintained. As such, new economic opportunities will be created. That said, it is easy to imagine these jobs also becoming automated as well: fleets of robotic trucks cruising America, loaded, unloaded, managed and maintained by robots. To close, I will engage in a bit of sci-fi style speculation.

Oversimplifying things, the automation of jobs could lead to a utopian future in which humans are finally freed from the jobs that are fraught with danger and drudgery. The massive automated productivity could mean plenty for all; thus bringing about the bright future of optimistic fiction. That said, this path could also lead into a dystopia: a world in which everything is done for humans and they settle into a vacuous idleness they attempt to fill with empty calories and frivolous amusements.

There are, of course, many dystopian paths leading away from automation. Laying aside the usual machine takeover in which Google kills us all, it is easy to imagine a new “robo-planation” style economy in which a few elite owners control their robot slaves, while the masses have little or no employment. A rather more radical thought is to imagine a world in which humans are almost completely replaced—the automated economy hums along, generating numbers that are duly noted by the money machines and the few remaining money masters. The ultimate end might be a single computer that contains a virtual economy; clicking away to itself in electronic joy over its amassing of digital dollars while around it the ruins of  human civilization decay and the world awaits the evolution of the next intelligent species to start the game anew.

 

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Don’t Say the C Words

Posted in Business, Environment, Philosophy, Politics, Reasoning/Logic by Michael LaBossiere on September 21, 2016

While weather disasters have always plagued humanity, there has been a clear recent uptick in such events. Naturally, the greater scope of these disasters is due partially to the human population being larger than ever and occupying more land—especially in areas prone to such events. That said, events such as the floods in Louisiana and the steady inundation of the sea in many places (such as Miami) are indications of a real change.

Nearly every climate scientist accepts that climate change is occurring and that human activity has had an influence. Given the historic record, it would be irrational to deny that the climate changes and few claim that it does not. The battle, then, is over the cause of climate change. Unfortunately for addressing the impact of climate change, it was brilliantly changed from a scientific issue into a political one. Making it into a partisan issue had the usual impact on group psychology: it became a matter of political identity, with people developing a profound emotional commitment to climate change denial. When denying climate change became a matter of group identity, it became almost impossible for reason to change minds—in the face of overwhelming evidence, people merely double down, deny the evidence, and craft narratives about how scientists are biased and environmentalists hate corporations and jobs.

To be fair, some of those who accept climate change do so out of political identity as well—they are not moved by the science, but by their group identity. They just happen to be right, albeit for the wrong reasons.

Not being an expert on climate change, I follow the rational approach to any issue that requires expertise to settle: I go with the majority view of the qualified experts. As such, I accept that climate change is real and humans play a role. If the majority shifted, I would accept that view—after all, the history of science includes numerous shifts.

If this matter were a purely abstract debate, then there would be no real worry. However, the impact of the changing climate is already doing considerable harm and the evidence suggests that it will continue to get worse unless steps are taken to address it. Unfortunately, as noted above, climate is now a political issue with deeply entrenched interest groups and strong emotional commitments. In some places, such as Florida, there is considerable political pressure to not even use the words “climate change.” The problem is, of course, that not using the words does not make the problems go away. Miami will slowly vanish into the ocean, even if people refuse to say “climate change.”

As a philosopher, I do believe in reason. However, I am also a practical person and know that reason is the weakest form of persuasion. Because of the entrenchment over climate change, trying to use reason and evidence to change minds would be a fool’s errand. As such, I suggest a purely pragmatic solution: stop using the C words (“climate change”) when trying to influence public policy, at least in cases in which there is strong ideological resistance. Using those words will simply evoke an emotional response and create strong resistance to whatever might be proposed, however reasonable.

As an alternative, the approach should be to focus on the specific threats and these should be cast in terms of risks to the economy and, perhaps, the lives and well-being of voters and consumers. There should be no mention of man-made climate change and no proposals to change behavior to counter man-made climate change. In short, the proposals must focus solely on mitigating the damage of weather events, with due care taken to present the notion that these events “just happen” and are “natural” with no connection to human activity.

It might be objected that this would be analogous to trying to combat the Zika virus by dealing only with the effects while refusing to say “virus” and not proposing any efforts to address the cause. This is certainly a reasonable point. However, if there was a powerful political movement that refused to accept the existence of viruses and citizens emotionally devoted to virus denial, then trying to persuade them to deal with the virus would be a nigh-impossible task. If they did accept the existence of the effects, then they could be enlisted to assist in addressing them. While this approach would hardly be optimal, it would be better to have their cooperation in mitigating the consequences rather than facing their opposition.

It might also be objected that I am deluded by my own ideological views and have been misled by the conspiracy of scientists and liberals who are in the pocket of Big Environment. Since I rather enjoy a good conspiracy theory, I certainly admit that it could be the case that the noble fossil fuel companies and those they pay are right about climate change and the scientists are either villains or dupes. If so, then not talking about climate change would be the correct approach—just as not talking about climate demons is the correct approach (because there are no such things). Since the weather events are really occurring, then addressing them would still be reasonable. So, regardless of whether climate change is real or not, my approach seems to be a sound one: avoid the resistance of climate change deniers by not using the C words; but enlist them into addressing those perfectly natural severe weather events that will be occurring with increasing regularity.

 

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Student Loans

Posted in Business, Law, Universities & Colleges by Michael LaBossiere on July 18, 2016

English: Day 3 of the protest Occupy Wall Stre...

The student loan crisis has been getting considerable attention in the media, but the coverage is often quick and shallow. James B. Steele and Lance Williams of Reveal from the The Center for Investigative Reporting have presented a more in-depth examination of the student loan industry. As a former student and current professor, I am concerned about student loans.

The original intention of student loans, broadly construed, was to provide lower income students with an affordable means of paying for college. Like most students, I had to take out loans to pay for school. This was back in the 1980s, when college costs were more reasonable and just as student loans were being transformed into a massive for-profit industry. As such, my loans were fairly modest (about $8,000) and I was able to pay them off even on the pitiful salary I was earning as an adjunct professor. Times have, however, changed.

Making a long story short, the federal government enabled banks and private equity companies to monetize the federal student loan program, enabling them to make significant profits from the loans and fees. Because many state governments embraced an ideology of selfishness and opposition to public goods, these governments significant cut their support for state colleges and universities, thus increasing the cost of tuition. At the same time, university administrations were growing both in number of administrators and their salaries, thus increasing costs as well. There was also an increase in infrastructure costs due to new technology as well as a desire to market campuses as having amenities such as rock climbing gyms. The result is $1.3 trillion in debt for 42 million Americans. On the “positive” side, the government makes about 20% on its 2013 loans and the industry is humming along at $140 billion a year.

While the government holds about 93% of the total debt, the debt collection was contracted to private companies and these were scooped up by the likes of JPMorgan Chase and Citigroup. As would be expected, these contractors profit greatly—about $2 billion per year. The collection process is often very aggressive and the industry has used its control over congress to ensure that the laws are very favorable to them. For example, student loan debt is one of the very few debts that are not discharged by a bankruptcy.

While student loans were originally intended to benefit students, they now benefit the government and the private contractors to the detriment of students. As such, there is a moral concern here in addition to the practical concerns about loans.

If the primary purpose of student loans is to address economic inequality by assisting lower income students attend college, then its current state is a clear violation of this purpose. This is because the system is creating massive debt for students while creating massive profits for the government and private contractors. That is, students are being exploited by both the state and the private sector. The collusion of the state makes seeking redress rather difficult—after all, the people need to turn to the state for redress, yet the state is an interested party and under the influence of the industry. This problem is, of course, not unique to student loans and it is one more example of how privatization is great for the private sector but often awful for citizens.

It could be argued that this is the proper function of the state—to serve the interest of the financial elites at the expense of the citizens. If so, then the student loan program should continue as it is; it is great for the state and the financial class while it is crushing citizens under mountains of debt. If, however, the state should serve the good of the citizens in general, then the status quo is a disaster. My view is, not surprisingly, that of John Locke: the state is to serve the good of the people. As such, I contend that the student loan industry needs to be changed.

One change that would help is for states to return to supporting public higher education. While there are legitimate concerns about budgets, education is actually a great investment in both the private good of the students and the public good. After all, civilization needs educated people to function and people with college degrees end up with higher incomes and thus pay more taxes (paying back the investment many times over). While there are professed ideological reasons for opposing this, there are also financial motivations: dismantling public education would push more students into the awful for-profit schools that devour money and excrete un(der)employed people burdened by massive debt. While this is great for the owners of these schools, it is awful for the students and society as a whole.

Another change, which has been proposed by others, is to change or end the privatized aspects of the system. While there is the myth that the private sector is vastly superior to the inefficient and incompetent state, the fact is that the efficiency of the private sector seems to mostly lie in making a profit for itself rather than running the student loan system in accord with its intended purpose. This is not to say that the state must be great in what it does, just that cutting out the large profits of the collection agencies would reduce the burden on students. This is, of course, a moral question about whether it is right or not to profit on the backs of students.

There has also been talk about reducing the interest rates of student loans and even proposals for free college. I do favor lower interest rates; if the purpose of the loans is to assist students rather than make money, then lower interest rates would be the right thing to do. As far as free college goes, there is the obvious problem that “free” college has to be paid for by someone—it is a matter of shifting the burden from students to someone else. As far as the ethics of such a shift, it depends on who is picking up the tab.

As a closing point, there is also the matter of student responsibility. My loans went entirely to paying education expenses—which is one reason my debt was rather low even for the time. While many students do use the loans wisely, my experiences as a student and a professor have shown that students sometimes use the loan money unwisely and put themselves into debt for things that have no connection to education. For example, faculty often joke that while the administrators drive the best cars, the students drive the second best and the faculty drive the worst. Students that overburden themselves with loans they use irresponsibly have only themselves to blame. However, the fact that some students do this does not invalidate the claim that much of the debt burden inflicted on students is unjust.

 

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The University that Wasn’t

Posted in Business, Ethics, Law, Philosophy, Politics, Universities & Colleges by Michael LaBossiere on June 1, 2016

While Hillary Clinton is mired in the tar pit of her email server scandal, Trump’s foes are hoping that Trump University will prove to be the quicksand that puts an end to him. While Trump named it “Trump University”, in 2005 the state of New York took action to make him change the name on the grounds that it was not, in fact, a university. A university has to meet certain standards and Trump’s operation did not meet these. This, however, is not the problem that Trump now faces.

As this is written, there is a class action lawsuit against Trump (who owned 93% of the “university”) that is based on an allegation of fraud against Trump. It has been claimed that the “university” was a scheme aimed at taking money from the elderly and the uneducated using carefully scripted high pressure sales tactics. The trial is scheduled in November, shortly after the presidential election. Because of this, president elect Trump might find himself in the courtroom after his victory. Assuming, of course, that he wins.

While I will not comment on the legal issues, the “university” seems to have been morally problematic. As noted above, calling it a university seems to have been deceptive, given that it was not a university. Naturally, Trump could be defended by arguing that he and everyone else involved were ignorant of the requirements for an institution being a university. While this would indicate poor planning, it would mitigate the charge of deception.

The practices laid out by the verified documentation show practices that are morally problematic. As noted above, the “university” seemed to have been targeted at the elderly and uneducated, people who would be regarded as easy targets for this sort of operation. Also as noted above, the sales tactics (though standard) seem morally dubious. There is also the fact that the customers seemed to have gotten little in return for their money and, in some cases, did not get what they were promised. One of the main focuses has been on the claim that Trump handpicked the instructors—a claim that was proven to be untrue. What adds an icing of awfulness to the whole wicked cake is that the “university” focused on how to cash in on the housing collapse. While making money off the suffering and misfortune of others is legal and often lauded in the United States, it should strike those with a conscience as reprehensible on its face.

Trump’s defenders can certainly address such moral condemnation. The easy any obvious avenue is to point out that it has yet to be shown that Trump did anything illegal. Targeting the vulnerable, using high pressure sales tactics, providing services of dubious value and training people to profit on the misfortune of others all seem to be legal. In fact, a case can be made that these are excellent things in regards to making a profit. Trump could even make the case that far from being a moral stain on his campaign, the way Trump University operated serves as proof that he knows how to get things done and that he has no qualms about doing what it takes to achieve his ends. Some might regard these traits as laudable in a president.

Trump has, as would be expected, responded to the explosion in the media. He has used the well-honed tactic of attacking the media, tapping into the well-established dislike and distrust crafted by Republicans and Fox News. While criticism of objectivity is a legitimate tactic, bashing the media is both a red herring (a rhetorical tool to distract attention from the issue) and a genetic fallacy (taking an alleged defect in the source of the claim as evidence the claim is not true). While the claims made about Trump by the professional media seem to be well and objectively documented, what matters politically is what impact this will have on the voters. Democrats are no doubt hoping for a “Trump U. Gate” to draw attention from Hillary’s server woes. However, Trump’s supporters might not care at all. This would be especially ironic, given that the allegation is one of fraud and his supporters tend to point to his authenticity as a major reason for their allegiance.

Trump has also gone after the U.S. District Judge who is presiding over the case. Trump has said that Judge Gonzalo Curiel is a “hater” and has said the Indiana native is Mexican. The hater remark is a mere ad hominem, which is a standard Trump tactic: to use personal attacks instead of providing actual reasons. Presumably Trump’s claim that he believes the judge is Mexican is also some sort of attack and perhaps a tactic to spin a narrative that he is being persecuted by the Mexicans for his courageous political incorrectness (or racism, as some see it).

This approach might play will with his supporters and he probably runs little risk in pushing people off the fence to the Democrat’s side. After all, if his remarks and behavior have not already pushed someone off the fence, these remarks should not be the rock that knocked the bird off the fence.

Trump has managed to thrive by behaving in ways that would have been political suicide for just about any other candidate, thus showing that the rules are different for him (at least for now). What remains to be seen is whether or not the revelations about Trump University will harm him politically. On the one hand, such allegations should damage his reputation as authentic and successful. On the other hand, while the details about Trump University are new to the public, it seems that they show nothing new about Trump himself. As such, it seems most likely that this will not hurt Trump much. That said, this might help Hillary a bit by getting the media, public and pundits focused on Trump University and not on Hillary’s server. Trump must get these eyes pushed back to gaze upon the server, which he is endeavoring to do.

 

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Antibiotics & the Cost of Agriculture

Posted in Business, Environment, Ethics, Law, Medicine/Health, Philosophy by Michael LaBossiere on May 23, 2016

Modern agriculture does deserve considerable praise for the good that it does. Food is plentiful, relatively cheap and easy to acquire. Instead of having to struggle with raising crops and livestock or hunting and gathering, I can simply drive to the supermarket and stock up with the food I need to not die. However, as with all things, there is a price.

The modern agricultural complex is now highly centralized and industrialized, which does have its advantages and disadvantages. There are also the harms of specific, chosen practices aimed at maximizing profits. While there are many ways to maximize profits, two common ones are to pay the lowest wages possible (which the agricultural industry does—and not just to the migrant laborers, but to the ranchers and farmers) and to shift the costs to others. I will look, briefly, at one area of cost shifting: the widespread use of antibiotics in meat production.

While most people think of antibiotics as a means of treating diseases, food animals are now routinely given antibiotics when they are healthy. One reason for this is to prevent infections: factory farming techniques, as might be imagined, vastly increase the chances of a disease spreading like wildfire among an animal population. Antibiotics, it is claimed, can help reduce the risk of bacterial infections (antibiotics are useless against viruses, of course). A second reason is that antibiotics increase the growth rate of healthy animals, allowing them to pack on more meat in less time—and time is money. These uses allow the industry to continue factory farming and maintain high productivity—which initially seems laudable. The problem is, however, that this use of antibiotics comes with a high price that is paid for by everyone else.

Eric Schlosser wrote “A Safer Food Future, Now”, which appeared in the May 2016 issue of Consumer Reports. In this article, he notes that this practice has contributed significantly to the rise of antibiotic resistant bacteria. Each year, about two million Americans are infected with resistant strains and about 20,000 die. The healthcare cost is about $20 billion. To be fair, the agricultural industry is not the only contributor to this problem: improper use of antibiotics in humans has also added to this problem. That said, the agricultural use of antibiotics accounts for about 75% of all antibiotic usage in the United States, thus converting the factory farms into for resistant bacteria.

The harmful consequences of this antibiotic use have been known for years and there have, not surprisingly, been attempts to address this through legislation. It should, however, come as little surprise that our elected leaders have failed to take action. One likely explanation is that the lobbying on the part of the relevant corporations has been successful in preventing action. After all these is a strong incentive on the part of industry to keep antibiotics in use: this increases profits by enabling factory farming and the faster growth of animals. That said, it could be contended that the lawmakers are ignorant of the harms, doubt there are harms from antibiotics or honestly believe that the harms arising from their use are outweighed by the benefits to society. That is, the lawmakers have credible reasons other than straight up political bribery (or “lobbying” as it is known in polite company). This is a factual matter, albeit one that is difficult to settle: no professional politician who has been swayed by lobbying will attribute her decision to any but the purist of motivations.

This matter is certainly one of ethical concern and, like most large scale ethical matters that involves competing interests, is one that seems best approached by utilitarian considerations. On the side of using the antibiotics, there is the increased productivity (and profits) of the factory farming system of producing food. This allows more and cheaper food to be provided to the population, which can be regarded as pluses. The main reasons to not use the antibiotics, as noted above, are that they contribute to the creation of antibiotic resistant strains that sicken and kill many people (vastly more Americans than are killed by terrorism). This inflicts considerable costs on the sickened and those who are killed as well as those who care about them. There are also the monetary costs in the health care system (although the increased revenue can be tagged as a plus for health care providers). In addition to these costs, there are also other social and economic costs, such as lost hours of work. As this indicates, the cost (illness, death, etc.) of the use of the antibiotics is shifted: the industry does not pay these costs, they are paid by everyone else.

Using a utilitarian calculation requires weighing the cost to the general population against the profits of the industry and the claimed benefits to the general population. Put roughly, the moral question is whether the improved profits and greater food production outweigh the illness, deaths and costs suffered by the public. The people in the government seem to believe that the answer is “yes.”

If the United States were in a food crisis in which the absence of the increased productivity afforded by antibiotics would cause more suffering and death than their presence, then their use would be morally acceptable. However, this does not seem to be the case—while banning this sort of antibiotic use would decrease productivity (and impact profits), the harm of doing this would seem to be vastly exceeded by the reduction in illness, deaths and health care costs. However, if an objective assessment of the matter showed that the ban on antibiotics would not create more benefits than harms, then it would be reasonable and morally acceptable to continue to use them. This is partially a matter of value (in terms of how the harms and benefits are weighted) and partially an objective matter (in terms of monetary and health costs). I am inclined to agree that the general harm of using the antibiotics exceeds the general benefits, but I could be convinced otherwise by objective data.

 

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