Fixing the Nation Redux

We are a divided country. Can we fix that? I don’t know. I am a technologist and have been for over fifty years. I have watched technology land and expand in our economy, our society and our culture for this entire time. It is continuing to do so seemingly without limit.

Twenty years ago at the Vancouver Institute I mused on the long-term impact of information technology on our body politic. Technology amplifies short-term concentrated pain against long-term diffuse gain, which is exactly what we need government to do. Yet, for our long run survival we have to some make decisions that favor the future over the present. Those decisions will not always be costless.

We simply lack the resources to fix all the problems of the world today. Not by a few percent but by orders of magnitude. We have to make choices. We do.

Five years ago I talked about the power of the ding. We are addicted now to technology. We get a fix by checking our phones. We live in an attention economy, where large firms make large profits by increasing this addiction to gain access to everything about us to sell us more.

One of the greatest episodes in my life was the five years I spent at Harvard as the head teaching assistant for John Kenneth Galbraith teaching from his book The New Industrial State. He was very good to me in many ways. How else would I have been present at dinners with Julia Child, Robert Penn Warren or George McGovern on the Saturday after the 1972 election? I admired him and his insight then, but please reread the book again now.

He saw it all over 50 years ago: How the technology elite would use technology to abrogate power and wealth to themselves while advertising takes over our lives. It is not perfect or perfectly accurate, but the trends are all there. I assure you he was not a technologist

When I left Harvard for Washington, I arrived a liberal. But then I met the government, and realized while there are many things we need government to do and do well, beyond a narrow range government is almost incapable of performing well. I still share most liberal ends but I am highly suspicious of most liberal means. In the last 50 years we have spent 20 trillion dollars to fight poverty, but poverty is still with us.

Like a plurality (maybe majority) of the country, I am socially liberal and fiscally conservative. However, with our two party system we get election choices between people liberal on both and conservative on both. This is endemic to our architecture. Single member geographic districts, first pass the post voting and a population segregated by political views — -we are what we are. Gerrymandering is a canard. Every study shows that it matters only a little, maybe 5 seats at most in the House.

Hillary did win a majority of those who voted for President, but the Republicans won an equal majority of those who voted for a member of the House of Representatives. In both cases, because they do not actually matter, they are really at best indicative. If they did matter, the vote would have been different in both cases.

Technology now makes emotional appeals almost trivial but very effective. Facebook has 500 million more users than the Catholic Church has adherents. The Trump campaign reportedly spent $150 million in 3 weeks on Facebook ads primarily in 5 counties, the five counties that decided the election. No one saw this at the time. With enough data, by name advertising is very powerful: different message to everyone. Half of the ads were to discourage voting by likely Clinton voters, not to vote for Trump. Since no one else sees the ads, they can be even more one-sided.

Nearly a century ago a great economist, Ramsey, introduced the concept of the social rate of discount: when making a decision, is it ethical to discount (i.e., count less) the welfare of future generations? He said no. In one of his last encyclicals, Pope Benedict reaffirmed this. Economists, however, have shown that discounting by the long-term growth rate of the economy is justified, but that is 2%, 3%.

Paradoxically, liberals have a high rate of social discount, and conservatives lower. This too contributes to division. Climate change, however, is an exception. Which is another reason for division. Our body politic wants all problems fixed today with lower taxes but a budget surplus to pay off the debt. And they vote accordingly. Unfortunately, this is impossible, so we end up rewarding those who most effectively mislead the voters.

A question I believe every candidate for President should be required to answer: In twenty years, what will be the ratio of U.S. per capita income to global per capita income and why? Say it is seven to one today (though much larger in terms of resources consumed). Long-term is even three to one sustainable other than through armed force? Read The Pentagon’s New Map. It is hard to map out any path for a stable world that does not stagnate incomes in the developed world.

We learned fifty years ago that most voters make up their minds weighing at most three issues, so political advertising is no longer about issues except making those issues where a majority agrees with you one of the top three. This is why social issues are so important. George W. Bush won reelection because a constitutional amendment on the ballot in Ohio banning gay marriage got 250,000 evangelicals to the polls who otherwise might not have voted but who also voted for Bush. It was not an accident.

Smartphones, social media and the ding now make emotional appeals simple, effective and cheap. The idealists who created this situation are appalled at the effect — -but very rich. They are conflicted — -but still very rich. Today their salve is the universal basic income.

We are are afflicted with confirmation bias: the more we agree with it the more we believe it is true. Nowhere is this more true than the U.S. mainstream media (MSM). They believe our current president should not be and is vile, crass, even evil. Bit if they believe that, then should they be on air wearing a cloak of neutrality?

On the other side we have Fox News which has exploited confirmation bias supremely well. The average news viewer is a white male, 57 years old. Spinning the news in a way your audience already leans is high profitable — -and very effective.

The result is that we have a huge attenuation gap. In fact every MSM outlet amplifies differences rather than attenuate them. For example, most every MSM headline notes that the proposed travel ban is against residents of siz majority Muslim countries. That does not mean it is against Muslims.

This whole thing started when Obama’s secretary of homeland security testified that it was almost impossible to vet refugees from some of the countries most in turmoil. Trump’s response the next day was if you know you cannot vet them, then don’t let them in. This is not wholly unreasonable.

Or healthcare. Obamacare is not perfect. Changes need to be made no matter who is in power. Democrats know this, but where is the Democratic alternative to the AHCA? The basic bargain in Obamacare was to tax young males on their health insurance to pay for medical care for older women. Because the tax was so high that few would buy otherwise, an explicit tax was placed on those who did not buy. It turned out to be too little. No MSM outlet spent much time on this bargain.

The AHCA tries to fix this problem. Essentially, an insurance company has to cover the medical costs of all of its subsctibers, spreading those costs across its population. However, premiums can vary only by age and the highest premium can be no more than three times the lowest. The data, however, says that the actuarial difference is closer to seven to one, even more if you varied by gender. AHCA changes from three to one to five to one.

Democrats immediately protested, saying this would increase premiums for older people, and some Republicans joined them for fear their elderly voters would punish them for this. However,, the more likely outcome is that elderly premiums would go down, because more young people would join the pool voluntarily. It might take a year or two. In any case, the current three to one plus tax is not getting the intended result. Time to try something else. Democrats, where is your alternative?

I have argued that one reform we do need is singular pricing. Health care providers should be free to set their own prices, but everyone pays the same regardless of method of payment. Right now, Medicare patients pay below actual cost, so others must pay more. Insurers negotiate large discounts. The people who must pay the most are those without insurance. Why not fix this problem? The law can require a 10% discount to Medicare and Medicaid if we wish to avoid increasing those costs.

I could go on. Most of the issues we face are hardly black and white, as the House Republicans found when Repeal and Replace met reality. Where can we have the spirited but honest debate on alternatives? Not in Congress or our media. A sad situation.

There is no simple answer obviously. Going backwards is just not possible. Japan did eliminate guns 500 years ago, a decision they applauded until Commodore Perry showed up with his fleet with lots of big guns in Tokyo Bay. That is the only similar example I know.

I have a few ideas: We should require Presidential campaigns to publish all online ads daily with the amount spent. Require a weekly press conference where the majority and minority leaders together for each house face the media while Congress is in session. We need to create an Inspector General of the United States elected by a two-thirds vote of each house on the recommendation of the President for a ten year term; this takes a Constituional amendment.

I wrote a similarly titled essay that was much more pragmatic. I still believe in those measures, but our challenges clearly go beyond them.