What constitutes a racist statement?

James Watson, joint winner of the 1962 Nobel Prize in Physiology or Medicine for his contribution to “discoveries concerning the molecular structure of nucleic acids and its significance for information transfer in living material,” has been getting himself a public lashing (and, indeed, has lost his job) after making some controversial statements about race and intelligence. Here is an article from The Times:

The 79-year-old geneticist said he was “inherently gloomy about the prospect of Africa” because “all our social policies are based on the fact that their intelligence is the same as ours – whereas all the testing says not really.”. He said he hoped that everyone was equal, but countered that “people who have to deal with black employees find this not true”.

He says that you should not discriminate on the basis of colour, because “there are many people of colour who are very talented, but don’t promote them when they haven’t succeeded at the lower level”. He writes that “there is no firm reason to anticipate that the intellectual capacities of peoples geographically separated in their evolution should prove to have evolved identically. Our wanting to reserve equal powers of reason as some universal heritage of humanity will not be enough to make it so”.

He claimed genes responsible for creating differences in human intelligence could be found within a decade.

The upset has revolved largely around his quotes included in the first paragraph above, but it’s the second paragraph that I want to focus on.

For the record – and I want to stress this – I believe that early childhood environmental factors play by far the greatest role in determining how a person will score in standardised tests of mental aptitude later in life. Steven Levitt (of Freakonomics fame), working with Roland Fryer, has a working paper that I find compelling enough. Here is the paper. Here is the abstract:

On tests of intelligence, Blacks systematically score worse than Whites. Some have argued that genetic differences across races account for the gap. Using a newly available nationally representative data set that includes a test of mental function for children aged eight to twelve months, we find only minor racial differences in test outcomes (0.06 standard deviation units in the raw data) between Blacks and Whites that disappear with the inclusion of a limited set of controls. Relative to Whites, children of all other races lose ground by age two. We confirm similar patterns in another large, but not nationally representative data set. A calibration exercise demonstrates that the observed patterns are broadly consistent with large racial differences in environmental factors that grow in importance as children age. Our findings are not consistent with the simplest models of large genetic differences across races in intelligence, although we cannot rule out the possibility that intelligence has multiple dimensions and racial differences are present only in those dimensions that emerge later in life.

That said, I want to make a controversial statement of my own: While Professor Watson’s comments will certainly be popularly perceived as racist and might well be able to be regarded as an incitement to racism, they are not necessarily racist in and of themselves. Indeed, without ever having met him, I seriously doubt that Professor Watson has anything other than the highest regard for any member of any race.

Watson simply gave a statement of his beliefs about the facts of the world. Those beliefs may be controversial and even wrong, but that alone does not imply any kind of moral judgement on his part. Let me give a couple of examples to illustrate my point:

  • I believe that white Australians, on average, have worse eyesight than Australian Aboriginals. That does not imply that I think that white Australians are somehow intrinsically less human than Australian Aboriginals. It does not in any way condone or encourage discrimination against white Australians.
  • I believe that women, on average, are weaker and possess less physical endurance than men. That does not mean that I think that all women are weaker than all men, or that men are somehow more worthwhile than women. I pass no moral judgement when I make this statement.

I will grant you that Watson’s ideas are dangerous, but he should be challenged to justify them; he should not be vilified for expressing them. Steven Pinker wrote an article on this very topic for the Chicago Sun Times in July 2007. I’d strongly encourage you to click through and read it all, but here are a few highlights:

By “dangerous ideas” … I have in mind statements of fact or policy that are defended with evidence and argument by serious scientists and thinkers but which are felt to challenge the collective decency of an age.

Dangerous ideas are likely to confront us at an increasing rate and we are ill equipped to deal with them. When done right, science (together with other truth-seeking institutions, such as history and journalism) characterizes the world as it is, without regard to whose feelings get hurt. Science in particular has always been a source of heresy, and today the galloping advances in touchy areas like genetics, evolution and the environment sciences are bound to throw unsettling possibilities at us.

What makes an idea “dangerous”? One factor is an imaginable train of events in which acceptance of the idea could lead to an outcome recognized as harmful … [T]he fear is that if people ever were to acknowledge any differences between races, sexes or individuals, they would feel justified in discrimination or oppression. Other dangerous ideas set off fears that people will neglect or abuse their children, become indifferent to the environment, devalue human life, accept violence and prematurely resign themselves to social problems that could be solved with sufficient commitment and optimism.

Should we treat some ideas as dangerous? Let’s exclude outright lies, deceptive propaganda, incendiary conspiracy theories from malevolent crackpots and technological recipes for wanton destruction. Consider only ideas about the truth of empirical claims or the effectiveness of policies that, if they turned out to be true, would require a significant rethinking of our moral sensibilities. And consider ideas that, if they turn out to be false, could lead to harm if people believed them to be true. In either case, we don’t know whether they are true or false a priori, so only by examining and debating them can we find out. Finally, let’s assume that we’re not talking about burning people at the stake or cutting out their tongues but about discouraging their research and giving their ideas as little publicity as possible. There is a good case for exploring all ideas relevant to our current concerns, no matter where they lead. The idea that ideas should be discouraged a priori is inherently self-refuting. Indeed, it is the ultimate arrogance, as it assumes that one can be so certain about the goodness and truth of one’s own ideas that one is entitled to discourage other people’s opinions from even being examined.

Now, if you’re still with me, go back up to where I quoted the article from The Times and reread the second paragraph. He is not being racist here. He is being controversial. Unfortunately, that seems to have been enough for him to be fired.

As a bit of a plug for my newfound profession … After Professor Pinker’s article was published, Steven Levitt noted:

What did strike me about the list of questions was how many are linked in some way to economists. Larry Summers comes to mind on gender differences and shipping pollution to Africa, Alan Krueger on the education of terrorists, Milton Friedman on the legalization of drugs, Richard Posner on a market for babies, Gary Becker on a market for organs, and even John Donohue and me on legalized abortion and crime. I’m not saying these ideas necessarily originated with economists, but that, at a minimum, economists often find themselves on the “wrong” side of dangerous ideas.

I would love to see what would happen if economists got the chance to run the world. My guess is it would be fun for a while, but the ending wouldn’t be happy.

Oz Election (again)

I’m still not that interested in general, but these two bits looked interesting in their specifics:

  • Looking at Bryan Palmer’s “Day 6 report,” it seems that the betting markets have started moving sharply in favour of the Coalition. Labor is still being billed as the favourites, but it’s narrowing fast.

* The action is really at the top. The only difference between the Howard and Rudd tax cuts is that Rudd wouldn’t cut tax rates from 45% to 42% for those earning over $180,000. Assuming the same rate of wage growth that we’ve had over past years, only 1.4% of adults in 2010-11 will have an income in that range, while only 3% of families will have an income-earner in that range.

* This means that the richest 1% of families get 7% of the Howard tax cuts, but only 4% of the Rudd tax cuts. The richest 10% get 28% of the Howard tax cuts, but 25% of the Rudd tax cuts.

* The education credit is fairly evenly distributed across the income spectrum (as Labor pointed out on Friday, 2/3rds of families with children are eligible for it). So the Rudd package looks more even – but only a little – if you take account of it.

The Election in Oz

So, the campaigning has formally begun for the 2007 Federal Election in Australia. I’m interested, but mostly in an abstract sense and at the same time have a definite feeling of “blah” towards the whole thing. When I do end up wanting to know what’s happening, I’m pretty sure that Bryan Palmer will be a superlative aggregator of information that I ought to care about.

I did notice, with a sigh and a rolling of eyeballs at the stereotypes involved, that the two sides are squabbling over the debates: how many to have and when to have them. The Coalition is calling for just one and early in the campaign (before most policies have been released), while Labor wants three spread out over the entire length of the campaign.

Two policies that I would vote for

  • I think that all forms of leave (annual/recreation leave, sick leave, public/bank holidays, etc.) should be bundled together into a single, generic pool that workers can draw down on when they wish, subject to managerial approval. However, it should be illegal for managers to deny approval for days of significant ceremonial importance to the major religions or for days of national significance (e.g. Australia Day and ANZAC Day in Australia).
  • I think that all fines issued for misdemeanours should not be for a fixed amount, but for a percentage of the transgressor’s income. When faced with the prospect of a $400 fine, somebody earning $20,000 a year will pay attention, but somebody earning $200,000 will not care nearly as much. I also think that any money raised through fines (a) should not be available to the department that issued the fine, but go into broader government funding (the police should not have a direct economic benefit from fining people for speeding) and (b) should be carefully tallied and reported publically on a regular basis. People need to be able to see that, for example, the money raised through speeding fines is contributing to funding hospitals.

Richard Freeman, WorkChoices and the dead hand of government

Richard Freeman is continuing his assault on WorkChoices:

[T]he new Australian labour code is such a massive break with Western labour traditions that it merits [global] attention. It was enacted in the midst of prosperity, without union or management excesses that endangered the economy, or public support. From the perspective of social science, we cannot get much closer to the ideal random assignment experiment at the national level than WorkChoices – an extreme change in law with no economic rationale or cause.

… Downloading the Workchoices legislation, I found a 687-page law with 565 pages of accompanying memorandum, all amending [i.e. not replacing] the government’s previous 861-page labour act …

… Parts of the law made so little economic sense that it seemed as if the Howard government had found a new band of whigged judges and labour lawyers to write it, on behalf of management. Which, in fact, I learned, was more or less how the law was developed. Writing the law was outsourced to the major Australian law firms that represented management …

… If re-elected this fall, the government will stay the course with Workchoices and we will see the results of this extraordinary effort to destroy collective action by workers. For the sake of social science, it would be great to see the experiment carried through to completion. For the sake of Australia, it would be great to see the election end the experiment.

He has managed to attract the attention of Justin Wolfers, guest-blogging on Marginal Revolution:

This is what happens when conservative governments confuse decentralization and deregulation.

Professor Freeman visited Australia back in September, speaking at the University of Sydney (I can’t seem to find a transcript online; only the event details and the press release) and on the ABC. He is not without his critics on the topic, but I think his points are valid. Even if you hate the unions, you’ve got to oppose Workchoices for the sheer weight of it. Where are the small-government Liberals in Australia?

Cam Riley wrote on this a while back:

When I read through the Workchoices legislation a while ago it was a brain dulling experience. The bill was long, boring and complex. It recently received a one hundred and eleven page amendment to add to the Workplace Relations Amendment Act, the Workplace Relations Amendment Bill, the Explanatory Memorandum, the Supplementary Explanatory Memorandum and the Second Reading Speech. Human Resources just got job security in the same way accountants do with the complex tax system.

Have a look at the graphs on Cam’s page. Make sure you take note of the scale on the vertical axes.

Meanwhile, John Quiggin has a suggestion for the Labor party in their campaign:

If I were running Labor’s campaign, I’d take the government’s total ad spending this term (around $750 million, IIRC) and convert that into around $5 million per electorate. Then find, for each electorate, $5 million of spending effectively foregone (two extra teachers at X High School, a local road project etc). Finally, promise to create a fund for worthwhile local projects like these, to be funded by a cessation of large-scale government propaganda.

Two questions for the punters

1) Does the large gap in the implied probabilities of a Labor win in the upcoming Australian Federal Election between overall-result betting (62% at the latest update) versus seat-by-seat betting (23% at the latest update) imply some sort of arbitrage opportunity? Is the overround really that large?

2) Why the gap in the first place? I assume it’s got something to do with the particulars of just how marginal each seat is (see below), but why do the two markets disagree so much? Is one of them massively incorrect?

For those that don’t know, I’d recommend looking at the tabular and graphical representations of the marginal seats here. Here are the guts of it (there are 150 seats in the House of Representatives):

Uniform swing Labor gains Labor total Coalition total Result
2.92% (+13) 73 75 Clear Coalition win
3.27% (+14) 74 74 Sort-of-hung parliment (depending on the two independents)
3.27% (+15) 75 73 Sort-of-hung parliment (depending on the two independents)
4.85% (+16) 76 72 Clear Labor win

The first 13 seats for Labor only need a 2.92% swing, or 0.22% per seat. The 14th seat will take an extra 0.35%, the 15th a further 0.90% again and the 16th another 0.71% on top. Remember that each extra percent of swing to Labor takes an increasing amount of goodwill from the electorate (i.e. increasing your swing from 1% to 2% is doable, but increasing it from 25% to 26% is effectively impossible).

Managing the news cycle

Peter Martin draws attention to the Australian Treasury press release listing the adjusted figures for the government surplus in 2006-07:

Preliminary estimates indicate that the Australian Government general government sector recorded an underlying cash surplus of $17.3 billion for 2006-07, which is $3.7 billion higher than expected at the time of the 2007-08 Budget.

A commenter on Peter’s site asks the obvious question:

Is it a good thing that treasury gets it’s numbers so consistently wrong? Who is responsible for the mistake – in this case an error of 27%. If it had gone 27% the other way who would have copped it?

27% is indeed a very large adjustment, and it’s rather difficult to imagine this sort of revision being made in the other direction. It is possible that the adjustment is just as much a surprise to Mr Costello as it (nominally) is to the media, but I suspect that it was always known – or at least believed – in the Treasury that the figures included in the 2007-08 Budget were too low. They will have, at best, decided to err on the side of caution (in case their internal numbers were wrong or there was a sudden crisis that worked against it) and, at worst, knowingly understated the true figures in order to guarantee the political capital boost they’d get later in the election cycle (i.e. now) when the upwardly revised figures were released.

I’ll leave it up to the audience to come to their own conclusions on which is the more likely explanation.

A course in Political Economy

Brad DeLong has mused on the purpose of a course in political economy:

This is where we cash in our winning intellectual bets, tie all the threads together, and come up with running code for a rough-and-ready framework for thinking about everything that happens at the crossroads where history and politics meet economies and sociologies in a world where village elders along the Zambezi lecture the principal deputy managing director of the International Monetary Fund on the implications of the Republican convention.

I sat in on a few lectures for LSE’s graduate-level course in this stuff over the last year (I may yet take it formally as my second optional) and I have to say that I find Brad’s vision a lot more interesting. Perhaps I should be doing my PhD at Berkeley?

The exponential rise of bureaucracy

Bureaucracy has been getting worse for years. Bigger, more complex, more self-referential, self-justifying, self-absorbed. More impenetrable. The language of bureaucracy has been changing as some sort of linguistic mirror of the organisation itself. It has happened in the public service at all three levels and in the private sector. It has happened in every industry. Why? My current thoughts, in three slightly overlapping points:

Point 1) The distribution of demand across skills and abilities has been changing. As we’ve moved away from agriculture, through manufacturing and towards services and office work, the need for administrative, bureaucratic tasks has increased.

Point 2) The distribution of task-related ability across the population has not changed, or at least has not changed much. There might be more people going to university, but there are limits to how much education can enhance a person’s innate ability.

Point 3) (a) A high-ability person will get more done than a low-ability person, irrespective of their coworkers.

Point 3) (b) The productivity of a person is influenced by the ability of their co-workers, so that high-ability coworkers will raise your productivity and low-ability coworkers will lower your productivity.

Point 3) (c) There is an optimal size to a team. Even if everyone is of equal ability, per-person productivity will (initially) rise with the size of the team, peak, and then start to fall.

Points 1 and 2 mean that the need for bureaucratic work is increasing, but the number of people needed to do that work is increasing faster because the ability of the marginal (new) bureaucrat is less than the average ability of the existing bureaucratic workforce. Point 3 means that the gap between these two growth rates increases as the demand for bureaucratic work increases. As an illustration, I imagine the demand for bureaucratic tasks increasing linearly, but the size of the bureaucracy (and the inner complexity of it) needed to provide this service increasing exponentially.

How do we fight this? I see three ways:

a) Try harder to shift the distribution of ability over the population. The Aust/UK governments are aware of this, but have unfortunately settled for simply lowering the bar for getting into university. A generous commentator might acknowledge that they had the best intentions at heart, but the end result is one set of numbers going up, the value of those numbers going down and the problem remaining the same. Seriously working to address the problem via this tack — if it can be done from this angle at all — could only be done over a timeframe of 20+ years.

b) Work to slow (or, ideally, reverse) the increasing demand for bureaucratic work in the first place. Cut red tape. Stop trying to watch, record, register and regulate everything. Remove overlap.

c) Decrease bureaucratic team sizes. Make them specialise. Specifically link bureaucratic teams to the end-consumers that they are nominally serving.