Educated sceptics

Mr Penguin alerted me to this interested article in Wired. As you would expect, in the US, Republicans are more likely to be sceptical about global warming than Democrats.  Environmentalism has always been found more on the left than the right, and Republicans have more to lose from action that makes energy more expensive.

But college-educated Republicans are far more likely to be sceptics than their less educated political allies, while a college education makes a Democrat less sceptical. What is about the combination of education and right wing politics?

It’s quite strange, because in all other areas of life I can think of, conspiracy theories are more likely to be found at the loony left end of the spectrum. But in this one, the more educated a right winger is, the more likely they are to believe that the scientific establishment is holding something from them.

A book meme!

Via pretty much everyone in my feedreader (well so far Pavlov’s Cat, Ampersand Duck and the Hoydens), here is a book meme.

What we have here is the top 106 books most often marked as “unread” by LibraryThing’s users. As in, they sit on the shelf to make you look smart or well-rounded. Bold the ones you’ve read, underline the ones you read for school, italicize the ones you started but didn’t finish. Confusingly, everyone seems to create their own code at this point, but I’m going to stick with this one (from the Hoydens).

Jonathan Strange & Mr Norrell
Anna Karenina
Crime and Punishment
Catch-22
One Hundred Years of Solitude
Wuthering Heights
The Silmarillion
Life of Pi : a novel
The Name of the Rose
Don Quixote
Moby Dick
Ulysses
Madame Bovary
The Odyssey
Pride and Prejudice
Jane Eyre
The [A] Tale of Two Cities
The Brothers Karamazov
Guns, Germs, and Steel
War and Peace
Vanity Fair
The Time Traveler’s Wife
The Iliad
Emma
The Blind Assassin
The Kite Runner
Mrs. Dalloway
Great Expectations
American Gods
A Heartbreaking Work of Staggering Genius
Atlas Shrugged
Reading Lolita in Tehran : a memoir in books
Memoirs of a Geisha
Middlesex
Quicksilver
Wicked : the life and times of the wicked witch of the West
The Canterbury Tales
The Historian : a novel
A Portrait of the Artist as a Young Man
Love in the Time of Cholera
Brave New World
The Fountainhead
Foucault’s Pendulum
Middlemarch
Frankenstein
The Count of Monte Cristo
Dracula
A Clockwork Orange
Anansi Boys
The Once and Future King
The Grapes of Wrath
The Poisonwood Bible
1984 [I did my HSC in 1984. Say no more - and I copied this comment from Ampersand Duck!]
Angels & Demons
Inferno
The Satanic Verses
Sense and Sensibility
The Picture of Dorian Gray
Mansfield Park
One Flew Over the Cuckoo’s Nest
To the Lighthouse
Tess of the D’Urbervilles - finished it for school (but a struggle - would never have finished it voluntarily)
Oliver Twist
Gulliver’s Travels
Les Misérables
The Amazing Adventures of Kavalier and Clay
The Curious Incident of the Dog in the Night-Time
Dune
The Prince - although it’s on my bookshelf ready…
The Sound and the Fury
Angela’s Ashes : a memoir
The God of Small Things
A People’s History of the United States : 1492-present
Cryptonomicon
Neverwhere
A Confederacy of Dunces
A Short History of Nearly Everything
Dubliners
The Unbearable Lightness of Being
Beloved
Slaughterhouse-five
The Scarlet Letter
Eats, Shoots & Leaves
The Mists of Avalon
Oryx and Crake
Collapse : how societies choose to fail or succeed
Cloud Atlas
The Confusion
Lolita
Persuasion
Northanger Abbey
The Catcher in the Rye
On the Road
The Hunchback of Notre Dame
Freakonomics : a rogue economist explores the hidden side of everything
Zen and the Art of Motorcycle Maintenance : an inquiry into values
The Aeneid
Watership Down
Gravity’s Rainbow
The Hobbit
In Cold Blood : a true account of a multiple murder and its consequences
White Teeth
Treasure Island
David Copperfield

I’m fascinated how much Jane Austen is on the list - I find it hard to imagine not finishing one of those you started. And I’m struggling to remember what I did read for school now. Not much, it feels like, going through this list.

*Edited - my formatting must have gone awry last night - I was claiming to have read 90% of these books! It’s now at a much more reasonable level.

Medicare levy changes

As part of the carefully scheduled program of budget leaks, the government has leaked a likely change in the medicare levy in this weeks’ budget.

A few blogs have comments - Larvatus Prodeo, wonders whether this will increase the pressure on the public system with a long comment thread, covering all sorts of health economics ground, and Joshua Gans comments that it is important to understand the price elasticity of health insurance when assessing this kind of policy change.

Some commenters miss this, but it seems to me that most people look at this kind of policy from the lens of a healthy person. And for a healthy person, it isn’t really cost effective to take out private cover. The public system covers you for catastrophes, and the chances of you receiving more than you pay in premiums over the next year are pretty small.

However, much of current health policy (as it impacts private health insurance) is an attempt to force as many healthy people as possible to take out private cover. Why? The insurers are required to charge the same premium for everyone. As I discussed in these two posts, most people understand their own health pretty well. The unhealthy people (like my cousin with chronic asthma) know that they are at a reasonable risk of needing medical care. The healthy people - who are generally younger than the unealthy people - know that the value of their health insurance is pretty low, and are often prepared to take the risk of some nasty event catapulting them into the public system.

But health insurers desperately want those healthy people. Because it reduces their overall premium. So that’s why they give out silly things like gym memberships and payments for alternative therapies. Because it’s a marketing ploy for the young. And the government’s compulsion in the form of an extra medicare levy gave the private funds an extra way of attracting healthy people - those well enough off to earn enough to pay the extra levy are also more likely to be healthy and not suffering a chronic disease.

I imagine that the premiums will find a new, higher, equilibrium level, as the proportion of healthy workers in the funds goes up. And private health insurance will become slightly less of a tax on the better off and the sick, and instead become more of a tax on the very well off and the sick.

Because as several of the larvatus prodeo commenters noted, the public system is at its worst if you have a chronic, but not life threatening disease. For those people, private health care will make an enormous difference to their quality of life.

I’d like to think that the changes to the healthcare system that might come with this proposed tax change could improve the public experience for the somewhat unwell. But I’m not holding my breath.

Political correctness gone mad…

Well actually, my title is ironic.

A teacher of a Year 1 class in Sydney has been sacked by the education department for posing nude with her husband and talking about their sex life in the sealed section of Cleo. You can read more here. This isn’t of course, political correctness as lambasted by the right wing, but a ridiculous overreaction by the Education Department.

As she said herself, if she was a high school teacher, what she did might have been inappropriate, as her pupils might read it. But a parent of any Year 1 pupil reading the Cleo sealed section should be first criticising the person who gave it to them (after celebrating their excellent reading) before criticising a familiar person for being included.

But apparently some parents (of children aged around 6) complained that their child’s teacher revealed herself to be a sexual being in a loving and committed relationship in a magazine aimed at teenagers.

Minority

In my professional life, I get quite involved in industry forums (fora?). Today, for me, was quite a big day. I had set up a workshop for my peers around the industry - roughly one per company, plus a few guest speakers - to discuss a professional issue. All up, there were around 30 of us. I was facilitating the session from the front.

After about half an hour, when I’d started to relax as the discussion got going, I suddenly noticed something. I was the only woman in the room. While I often have the experience of being the only woman in a meeting, generally the total number of people in that case is in the single digits.

It’s ironic. Two years ago, when I took on my current role, I had a few old codgers congratulate me, and comment how women were taking over the profession. At that stage there were four of us in that group. Now the other three have moved on (one is now a CEO, the others have different roles), and I’m the only one left.

Ten, even five years ago, that sudden realisation would have given me stage fright. Now I have the confidence to be quietly amused. But I bet none of the men in the room have ever been close to being the single representative of their gender in a business context. They would find it extraordinarily confronting, if they had.

All those people who confidently say that gender equality at the top of companies is a matter of time? Take a closer look. It’s not going to happen without serious cultural change. This isn’t about helping women manage families. To get serious representation of women at the top of companies,  the culture of large organisations needs to genuinely include women.

Rise of nations is responsible

It’s been school holidays recently, and I took a week off, just to hang out with the boys. They did a drama course in the mornings, but the rest of the time we lazed around the house not doing very much. Perfect blogging time, you would think, but actually not. I became utterly addicted to a computer game we’ve been playing together - Rise of Nations. You get a nation of your own, and guide it through doing research and trading from the stone (ish) age to the information age (i.e. now). You win either by conquering all the other nations, or building wonders.

We have networked it, in our house, so that we each have a computer, and a nation of our own, and play cooperatively. Lots of fun, and addictive enough so that I’ve been playing against the computer in the evenings. My google reader feed is out of control, and I haven’t written a blog post for three weeks! I’m sure I’ll be back, once the excitement has worn off, but in the meantime - posting might be lighter than it has been.

Price signals vs coercion

Sydney’s water crisis is over, for the moment. Our dams are now 65.5% full - up from 33.9% on the 8th February 2007. That will last us around two to three years without any more rain, at the current rate, which feels like a reasonable cushion. Not coincidentally, Sydney’s water consumption went from an average of 1,800 or so Megalitres per day back in 2001, to around 1,300 or so now.  Although there has been an increase in price during that time period, according to this study (from Cyprus!), demand in Sydney barely changes with an increase in price - the price inelasticity is -0.09, which means that an increase in price has very little effect on consumption.

So the way in which Sydneysiders have dramatically reduced their water consumption has been through restrictions - good old government regulation.

I find this interesting. It is very common to find economist authored opinion pieces in the papers commenting that if only the government would use price signals for this or that issue, the market would automatically find the correct level.

But, price inelasticity is straight from Economics 101. Some commodities aren’t much influenced by price - at least in the current ranges of prices and consumption (I don’t doubt that if water was per litre as expensive as (say) scotch for the average household, the use of plumbing and tolerance of dirt would drastically change). At the margin, using restrictions rather than water pricing will potentially stop some high value uses of water that would occur if pricing were to be used.

So the government turned to non price signals - a combination of coercion and shaming (mostly coercion, through water restrictions, but public opinion has turned against people wanted to maintain lush green lawns).  This study, from IPART (which is the independent pricing tribunal responsible for setting water prices) suggests that to replicate the effect of the water restrictions we have now you would need around a 200% increase in water prices (if you wanted to have a block safety net of water with an price that didn’t vary).

Although I’m in the camp that we very much need a carbon tax to at least start down the path of reducing greenhouse gases, price increases are not necessarily a panacea for every type of product. Sometimes it is easier to reduce consumption in other ways, particularly if the price is cheap enough to start with that substnatial waste is a result.

Work and life - some statistics

This week Beaton Consulting released a study on work life balance. Beaton’s main game is as advisors to professional services firms (law firms, accounting firms, etc). Every year they do a mammoth survey of those firms’ clients, to find out who is the best in each category. As a sideline, they tack on a few questions at the end about something topical - this year work life balance.

So the people surveyed are not a representative sample of employees; rather they are a representative sample of people who might buy professional services - generally senior knowledge workers. I was one of the 12,000 or so respondents, so I was very interested to see what the outcomes were.

There is a huge amount of data - with a data set that big you can get some quite interesting correlations. I’m not sure that I can do the data justice, but here are a few points that struck me on reading through the report:

• part time workers were more likely to feel “role overload” - those who at work are constantly feeling rushed and time crunched.
• of those Gen Xers completing the survey, a significant number more men (76%) had children than women (55%) - suggesting that if you were a woman and wanted children, you were more likely to leave this highly paid professional segment of the workforce
• Workers who have experienced significant family conflict with work are much more likely to be actively looking for another job

The authors’ recommendations from the data suggest that employers need to face some questions raised by this research:

1. Women with dependent care gravitate to certain sectors – and other sectors miss out on this source of talent.

- the study suggests that women who have dependents that they are responsible for caring for tend to gravitate to public sector and smaller company roles - so larger firms are missing out on talent

2. Why is it that male knowledge workers outnumber female knowledge workers by 3 to 1?

- the people who answered this study were overwhelmingly male. To me that’s not surprising, as they were also senior enough to be regarded as consulting clients, but a bit depressing, too.

3. Why do knowledge workers stay with their organisations for such a brief period?

- there is a strong association with work life conflict and intent to leave a company which suggests that getting work life balance right will help this issue enormously 

4. Will firms have problems attracting and retaining staff if they ignore these issues?

- surely the answer to this one has to be yes

5. Will Australia’s fertility rates continue to decline?

- a bit more of a controversial question this one - our fertility rates appear to have improved lately, but I’ve argued before that that is a once off generational change that women are having the same (or smaller) numbers of babies later in their lives. This study certainly supports the notion that intense workplaces reduce the number of children their female workers have - and it can’t just be that the women who want to have children all go and work somewhere else.

On the whole, there was nothing enormously surprising in this survey. But it adds considerable statistical weight to the point that there is value to employers in providing flexibility - on average employees who are feeling less pressured, and with more access to flexibility are likely to be more content with their work, less likely to take sick days, and less likely to consider leaving the organisation.

Have a look at the  Australian for some more commentary. As a whole it adds weight to my private conviction that the employers who get work life balance and part time work right will be enormously advantaged in the race to employ good people that is coming.

Password mania

The other day I counted the number of passwords I use for various things on my computer at work. There are 26.  They are all on different cycles. Some I am required to change monthly. Some quarterly, some never change. Some have a requirement to have a mix of capital letters and lower case, or numbers and letters, or both. They cover a variety of systems. There are three different purchasing systems (depending whether it is invoice based, credit card based, or a contractor). There is the HR system where I enter my annual leave, and the two different performance management systems. There is another system where I create contracts if I need to hire a new person. I’ve got another password for the spreadsheet each time I do the annual remuneration review for my team.

Unsurprisingly, I have a spreadsheet (password protected, of course) where I keep them all. I first created that spreadsheet after nearly shouting at a helpdesk person. After politely resetting my password (probably the third time I’d had to do that that month), he said, “have you thought of choosing a password that is easy to remember?”

I imagine that each time a new system was created, some very cautious IT or security person thought hard about the best way to keep that system secure. They had possibly been burnt by someone in the past giving away access. So they make sure the password has to change monthly, and that it can’t be too obvious.

But the end result is anything but secure. My brain cannot possibly hold all that information. I have to store it somewhere. And while I am at least cautious enough to have a password protected spreadsheet, the end result is that I have one password, which I never change, to give me access to the whole system.

Security is often like this. When putting it together, you have to understand real people’s behaviour. If you make it too difficult, then it will be breached, not by the enemy  (whoever they are) but by the people you are trying to keep secure, who can’t cope with it.

Populist economics

The Sydney Tele yesterday had a front page screamer about Glenn Stevens, Governor of the Reserve Bank - Is this man Australia’s most useless? There were two main parts to the critique. First, that the Reserve Bank should be stopping the banks from raising interest rates beyond the official cash rate;

“it is a key part of his job as Reserve Bank governor to use official interest rates as a guide for the major banks as to what they should charge on mortgages.”

And the other slam was at the governor for suggesting that the government raise taxes rather than lowering them;

THE nation’s most powerful economic figure has committed a double betrayal of working families … saying taxes could be increased.

While one could argue with the Governor’s interpretation of the economy, the Governor is doing exactly what the Reserve Bank’s charter, clarified by a statement on monetary policy (1996, jointly issued by the then Governor and Peter Costello, then Treasurer) says it should.

The framework for the operation of monetary policy is set out in the Reserve Bank Act 1959 which requires the Board to conduct monetary policy in a way that, in the Board’s opinion, will best contribute to the objectives of:

1. the stability of the currency of Australia;
2. the maintenance of full employment in Australia; and
3. the economic prosperity and welfare of the people of Australia.

The first two objectives lead to the third, and ultimate, objective of monetary policy and indeed economic policy as a whole. These objectives allow the Reserve Bank to focus on price (currency) stability while taking account of the implications of monetary policy for activity and, therefore, employment in the short term. Price stability is a crucial precondition for sustained growth in economic activity and employment.

Both the Bank and the Government agree on the importance of low inflation and low inflation expectations. These assist businesses in making sound investment decisions, underpin the creation of new and secure jobs, protect the savings of Australians and preserve the value of the currency.

In pursuing the goal of medium term price stability the Reserve Bank has adopted the objective of keeping underlying inflation between 2 and 3 per cent, on average, over the cycle. This formulation allows for the natural short run variation in underlying inflation over the cycle while preserving a clearly identifiable benchmark performance over time.

Nowhere does the charter (section 10(2) of the Reserve Bank Act) or the clarifying statement say that the Reserve Bank has any responsibility for individual banks’ pricing policies - particularly in the context of an increase in their costs (the banks are all putting their prices up because their costs of funds on the international market has increased substantially).

And, whether you like it or not, the Reserve Bank’s inflation objective (stability of the currency) comes above maintenance of full employment and the econmic prosperity and wealth of the people of Australia.

In suggesting that taxes should be increased, and supporting the banks’ increases in interest rates charged to their customers, the Reserve Bank governor is supporting actions that might reduce spending in the economy. Given that the Australian economy as a whole is getting overheated (at least by some measures), and inflation is definitely outside the 2-3% band, the Reserve Bank is doing its job by suggesting measures that might reduce demand, and hence inflation.

If the banks are able to completely pass on their increases in costs to their customers, by increasing their interest rates, then the problem is inadequate competition. That’s the job of the ACCC, and the government, not the Reserve Bank.

It’s too much to expect the Tele to publish nuanced economic analysis on its front page. But it does annoy me when such a nominally right wing paper publishes such populist economic claptrap.

Update: Possum comitatus and Mark from Larvatus Prodeo don’t much like the article either.