Showing posts with label government intervention. Show all posts
Showing posts with label government intervention. Show all posts

Tuesday, January 26, 2010

Years of abstinence programs but higher pregnancy rates

Teen pregnancy rates have risen in the US by 3%, the first reversal in the downward trend that started in 1990. Valerie Huber of the National Abstinence Education Association, a group that only exists because of Bush redirecting money from your pocket into theirs, says the rise in pregnancy rates is "another opportunity to throw a barb at abstinence education." Abstinence doesn't need education. Abstinence is doing nothing and any idiot can do nothing. On the other hand, responsible sexuality takes information and knowledge—two things that religious loons think are dangerous even for adults.

For teens, 15-17, the pregnancy rate reached its highest point in 1990 and it steadily declined, year after year, until 2006 (the data for 2006 is what is now being released.) In 2006 it rose for the first time since the high in 1990.

Apparently all that government effort to stop teen sex hasn't worked. In 2007 the government crowed that teens were having less sex than ever before. The bureaucrats reported that in 2005 47 percent of high school students reported they were sexually active, down from 54 percent in 1991. The government said that lowering of reported sexual activity was good and that it lead to lower "birth rates." But teen pregnancy rates went up, not down. And by 2006 birth rates were also up.

Less sex is supposedly taking place but pregnancy rates are up. That would seem to indicate that what changed is that fewer teens are now taking precautions to avoid unwanted pregnancy—and for most teens being pregnant is unwanted. This would seem to verify the criticism of the abstinence programs that what they do is encourage reckless sexuality among teens.

The dilemma for the moral conservative (or immoral conservative, depending on your point of view) is that teens are having less sex but there are more pregnant teens. Perhaps sex education does "encourage" sex but it would seem to encourage responsible sex. And perhaps abstinence encourages less sex but it would seem to discourage responsible sex as well. So, is the choice between more teenage sex with less pregnancies or less teenage sex with more pregnancies?

If you can only have one or the other which should the conservative support? I guess it depends on whether or not the conservative in question actually cares about teens getting pregnant more than he is horrified by teenage sexuality. My guess is that practical conservatives, who worry because teen pregnancy creates social problems for the teen, will want less pregnancy. But the moralistic conservative, imbibed with "biblical morality" will think the sex itself is immoral and be thrilled that there is less of the "dirty" activity going on in general, even if the result is more ruined lives. And, when it comes to the social problems of girls becoming mothers, the moralistic conservative is likely to see that as nothing more than the "wages of sin,
" which are a good thing since they discourage "immorality."

I'm not surprised that years of government abstinence programs would lead to higher pregnancy rates. Couterprodutive results are often the result of government meddling. With that in mind I can't say I'm hopeful for the state of the middle class now that Obama has pledged to protect them. I've watched how government programs in the US "protect" kids and it isn't pretty. I've seen how we our government went in to Iraqi to "protect" people from Saddam Hussein. And I've seen how the drug warriors protect us from drugs and the travel Nazis protect us from terrorists. Perhaps we should just kiss the middle-class good bye now and get it over with.

Saturday, November 7, 2009

Bailout promises, Mao's famine and bad incentives.

I suspect a lot of people are shocked by the blatant falsification of statistics by various government bureaucrats, at different levels, which gives a pretense to the Obama administration to claim their stimulus package created, or saved, jobs. I'm not sure why people are surprised at all.

One of the problems with the bureaucratic system of management is that such self-reporting is often the criteria used to measure "success." The problem is that the incentives for the bureaucrats are such that they pushed to fudge the numbers, in whichever direction necessary, to please their superiors. In the bureaucratic system pleasing the overlords, is necessary for advancement. So it's best to tell them what they want to hear.

Equally important is that government agencies, which report successes for their programs, often get showered with additional funding. Additional funding means more conferences for the top bureaucrats, often at resorts with very nice beaches. It also means more funding for pay increases and benefits.

There are numerous reasons why it is "helpful" to distort the facts in a way pleasing to those who have power over you. Often the distortions are small, just an attempt to show something "positive," but as the distortions move up the bureaucratic ladder they accumulate and the distortions grow.

A prime example of this, and the disastrous consequences that can follow, is found in Jasper Becker's book Hungry Ghosts. Becker's book is about the great famine in China from 1958 to 1962, where it is now estimated that 30 million people starved to death. And bureaucratic incentives to distort information had a lot to do with it.

Mao was a moron, plain and simple. He believed that various Marxist principles could be used to produce bumper crops. Since the Maoists said that solidarity of the people made the people stronger, then the same applied to grains. Thus growing grains tightly packed together would make them stronger, not destroy crops. This was just one area where the Maoists tried to apply "scientific Marxism" to the physical laws of agriculture—applications that failed over and over.

So these experiments were dismal failures. But such failures are not enough to lead to a famine. Other factors come into play. One such factor was the fear of the dictator. Mao's ideas failed but no one wanted to tell him. Tyrants could easily confuse the message with the messenger. So the incentive was to lie.

Local bureaucrats, instead of admitting that crops had been reduced, decided to write reports claiming that crops had increased. Those reports went to the superiors. The superiors, not aware of how much of the report was bluster, combined these exaggerated reports together. And they, thinking the reports were accurate, saw no harm in making them look even better by increasing the crop yields. And so it went. As the "data" accumulated it appeared that scientific Marxism was a success in agriculture. The top echelon of Mao's China got reports that made them very happy.

Desperate for hard currency the Chinese officials decided to take advantage of their bumper crops and sell them outside China. So they confiscated a large section of what crops did exist for export. This meant that food was scarcer at the local level as the farms were depleted of their stock to fill the quotas for export. A year goes by and the next set of reports have to be prepared. Again no one wanted to be the first to prick the Maoist bubble. Nor did anyone want to report they had failed, not when everyone else was apparently so successful, as the reports clearly indicated. So once again they took the figures from the year before and added a bit to them. And the process repeated itself.

At the top levels of the government Communist officials received more data, carefully collected from across the country, indicating an even larger crop than the year before. So the quotas for export were increased.

More food was confiscated. But a problem arose. You can't confiscate food that doesn't exist. Authorities scoured the countryside and couldn't find the crops that supposedly existed. The conclusion they drew was a simple one: the farmers were greedy, counter-revolutionaries who had obviously hidden the bumper crops. They were attempting to sabotage the revolution. So the officials, convinced the farmers had hidden food somewhere confiscated all the food they could find—which was actually all the food there was. The farmers had no hidden stocks, the data was wrong. The cumulative effect of lots of small distortions produced a massive error which resulted in the deaths of millions.

We saw a similar sort of bureaucratic distortion when the Bush administration looked at the "reports" on weapons of mass destruction in Iraq. Intelligence agents, dealing with lots of unknowns or information that could be interpreted in various ways, tended to interpret the data with the wants of their superiors in mind. This tended to bias everything in one direction with no one wanting to be the odd man out. This was especially true with Bush officials who tended to be disciplined if they contradicted what the President wanted. (A humorous example of this process can be found in the film The Tailor of Panama.)

Can't the same thing be found in private industry as well? Yes, but to a much more limited degree. For instance I know a publication which faked its circulation figures, claiming numbers double the actual figures. Advertisers paid on the assumption that the number of responses would be higher than they actually were. The advertisers who could accurately measure the results tended to drop their ads. But some businesses had no method of determining results from their ads and they tended to stick around as advertisers where the others didn't.

The difference is in how results are measured. The private sector has a "bottom-line" which tells the superiors everything they need to know. If something is working it shows up in increased profits. If it isn't working it shows up in reduced profits or losses. (For a good exposition on the differences between profit management and bureaucratic management see Bureaucracy by von Mises.) The more a business is able to use the "bottom-line" the harder it is to fudge the reports according to the benefits that accrue to those making the reports.

Government tends to shun profit management and has no bottom-line. Attempts to quantify the data are distorted by the incentives of the system. The net result is that even well-meaning superiors find it difficult to make rational decisions because the information they use has been distorted by the system.

While Mao could be a tyrant I don't think the evidence indicates the starvation was intentional—as opposed to Stalin's planned starving of the kulaks in the Ukraine. Eventually the situation got so bad that someone told Mao the truth and the situation changed. However, Mao's moronic Marxism was sufficient to create the crisis and the bureaucratic system made the situation worse by distorting the facts. And Mao was clearly a willful killer who ran a system that murdered millions intentionally as well as unintentionally.

The key point is that such distortions are systemic in nature. They are built into the structure of the bureaucratic model of management. They are not determined by the motives of the bureaucrats per se. Good people, facing bad incentives, are still likely to screw up. Bad people, facing good incentives, are likely to do good things. The progressive Left errs by thinking intentions are critically important while incentives are a minor issue. Many of the errors of the socialist Left are derived from this one fallacy.

By the way, this exposes the errors conservatives make about the Left as well. They assume the bad results, inherent in the system, are the result of immoral or evil motives by the Left. Typically that is not the case. A second, similar error of the conservatives, is that they buy into the Left-wing assumption that motives matter. So the Right will claim that putting "moral" people, "Christians" or "conservatives" into the system will change things. It won't. In the past, before they were taken over by theocrats, the Republicans claimed that putting "businessmen" into office would give us business-like management. That wasn't possible. The problem is not personnel but incentives built into the system.

Tuesday, July 7, 2009

Theologians shouldn't tresspass on economics.

If an economist used his position to pontificate on theology the world would laugh. But when a theologian uses his credentials, in an imaginary field, to lecture on economics we are expected to pay attention.

As this blogger sees things the one institution that has no right anymore to lecture on morality is the Roman Catholic establishment. But the Vatican has been sticking its nose into the affairs of the world for centuries and won’t stop now. Consider some of the uninformed statements made by the current Vatican leader, Joseph Ratzinger, who uses the name Benedict when pretending to speak for God.

In a new encyclical on economics Ratzinger continues the Catholic tradition of opposing depoliticized, free markets. Like his predecessors he misstates what depoliticized markets are. He writes that “profit is useful if it serves as a means towards an end” but if profit “is produced... without the common good as its ultimate end, it risks destroying wealth and creating poverty.”

Ratzinger has been concerned with imaginary “truth” for so long that he doesn’t understand how this world works or why. Profit is a motivating factor. Each of us acts to promote our self interest—even the Catholic hierarchy. That motivation can lead to good and to bad but seeking “the common good” is more likely to lead to bad results than good. Let me explain something that the Vatican, always besotted with power, has never understood.

When profit-making is politicized it leads to bad results. When profit-making is depoliticized it leads to good results. First, consider the depoliticized market. A depoliticized market is one where individual entrepreneurs are unable to impose their will on unwilling consumers. To a large extent the local grocery store is a depoliticized market (though even here politics can distort things). This store must entice you to buy there because it has no ability to force you to purchase there.

The result is that they have to make an effort to serve your good if they wish to make a profit. Because they lack the ability to use force they need your voluntary co-operation in order to make a profit. Like them, you too are looking out for your own self-interest. You will trade with them provided you believe that you are better off making this exchange than any other trade you might make. Your decision, like theirs, is based entirely on your self-interest.

You are not attempting to increase their profits. If they profit, or not, is of no concern to you. You are merely making an exchange that you believe will benefit yourself. Similarly the store is doing the same thing. By seeking their own self-interest both are acting in ways that makes the other better off. Yet neither is seeking to improve the life of the other.

The danger comes in when concepts like the “common good” are allowed to dominate. This concept is used to politicize the market. The argument is that an unregulated market is not one where the common good dominates so individuals act in bad ways. But how? Without the ability to force other traders into unwilling exchanges there is no ability to create exchanges where one party loses.

The only way to systematically destroy the mutual benefits of free exchange is to politicize the market. Politicization means that the state will forcibly intervene into the exchanges. But what can government intervention accomplish?

It might require two individuals to exchange, who would have done so anyway. But since they would have exchanged without the intervention then government has, in fact, accomplished nothing.

It might force an exchange where neither of the parties would have made the exchange. Why didn’t they make the exchange voluntarily, in this case? The answer is: because each considered the exchange a net loss. Intervention here makes each trader worse off, not better off.

What the advocates of politicized markets really want is to force exchanges where one partner benefits and the other one loses. Ratzinger, totally ignorant of economics, believes that the political classes will use state power to force exchanges that benefit the poor and powerless. The Vatican, one of the wealthiest institutions in the world, is quite willing to use the wealth of other people to “benefit” the poor but rather unwilling to use their own wealth in that manner. They are willing to use funds donated from their members for such things but the vast holdings of the Vatican itself are not sacrificed for the “good” of the poor.

Politicized markets attract predatory individuals who use state power for their own benefit, or for the benefit of their favored friends or supporters. The poor and powerless never control the politicized power structures no matter what Ratzinger or Marx or anyone else may think. Power attracts the powerful, not the powerless. Concentrated political power, established under the pretence of the “common good” always ends up in the hands of private interests. More importantly these private interests are able to impose exchanges on individuals that they otherwise would not make.

The reality is that politicized markets can never serve the common good since they can only impose exchanges which are not wanted, not exchanges that are wanted.

What Ratzinger wants is political control over markets. He fantasizes that political power will be used according to the values he espouses. In truth, that power will be used in ways quite different from what he wants.

Ratzinger wants a state system of redistribution of wealth. How ignorant can this man be? When power is in the hands of the powerful there is real wealth redistribution. But it comes at the expense of the poor and the powerless. One of the great myths of redistributive state is that it redistributes wealth toward the needy. While there may be some show-programs which appear to help the poor and powerless, for the most part redistribution will go up the economic ladder not down.

Ratzinger continues what has been church tradition for centuries: opposition to depoliticized markets and a belief in centralized control of markets based on Catholic teaching. The Vatican has never been happy promoting their own morality on matters such as sex or economics. What they have always yearned for, and still yearn for, is for state power to coercively force Catholic moral values on others. Ratzinger wants the forced redistribution of wealth, not charity. The Vatican has consistently been unable to envision their moral agenda without the use of state power. This sort of fascistic tendency is not one the Vatican is about to give up, no matter what some “libertarian” apologists for Catholicism say.