Category Archives: Web Article Review

the singularity is near…in China

This article in Economist says China wants to be a

“cyber superpower”—one that, within a dozen years, will lead the world in artificial intelligence (AI), quantum computing, semiconductors and the coming “5G” generation of mobile networks, not to mention synthetic biology and renewable energy.

This is a pretty good list of technologies of the future. Although they clearly have some potential military applications, they have many more civilian ones where everyone can gain at the same time. Personally I don’t think investing in the technologies of the future should be thought of as a zero sum game. It is more a question of whether the U.S. wants to keep up with its current peer group of the most advanced nations with the highest quality of life, a group it is still part of but in the middle of the pack and slipping toward the back, rather than out in front. If the idea of competing to lead in these technologies spurs the U.S. to action, that is okay with me. The article does have a few policy prescriptions:

Better that it should develop a broader policy to strengthen its technosystem, argues Ms Kania of CNAS. Instead of making it as closed as the Chinese one, which would seem to be Mr Trump’s preference, it needs to engage with allies such as Europe, Japan and Korea to spread open standards. It needs to build a shared digital infrastructure, such as common pools of key data for things like self-driving cars. And it needs to rediscover what has made it great in technology: investing in both basic and applied research and being an attractive destination for highly qualified immigrants (a requirement which, it must be admitted, the Trump administration is not well placed to meet).

I’ll offer a few more along these lines, if the U.S. would like to be a “cyber-superpower” a dozen years from now:

  1. Small businesses and startups innovate, and they challenge lazy established big businesses to innovate. It needs to be much, much easier to start a business anywhere in the United States. It is not necessarily taxes and regulations, but the fact that there are too many complicated, confusing taxes and regulations fragmented among local, state, and federal entities. We need to figure this one out.
  2. Economic growth requires continuous investment in human capital. People working toward an academic degree need an income, and the government needs to find a way to provide them with one. We need job skills training and retraining programs, and employers need to be heavily incentivized to train the workers they need in the skills they need. Skills-based immigration and guest worker programs can fill in the remaining gaps between the needed skills and available trained Americans.
  3. Economic growth requires continuous investment in physical capital (what economists call “plants and equipment”) and in public infrastructure. For the former, tax incentives could be the answer, however unpopular they might be. For the latter, an infrastructure bank could be the answer, where the actual creation of the money supply is done through the issuance of infrastructure bonds.
  4. Economic growth requires continuous innovation. On the private side, big tax incentives for research and development could be the answer, while on the public side, we could just turn on the taps for funding research, particularly at public universities. This has been slipping in recent decades from where it used to be.
  5. I just mentioned a number of programs that require public spending, of course. I think they would pay for themselves in the long run, but in the short run new sources of revenue would be needed, however politically unpopular. I would look to a value added tax as the international best practice which the U.S. continues to ignore, and taxes on pollution and waste which have the added benefit of making us healthier and safer.
  6. For any of these policies to have a prayer of getting through our political system, we would need a constitutional amendment making it clear that the right to free political speech applies only to human beings, not to corporations or dollars. Otherwise the United States will not be able to have these nice things.

the sinking dollar

Barry Eichengreen points out that while the differential between growth and interest rates between the U.S. and most other countries should have predicted a stronger dollar in 2017, it actually fell by 8% and is still falling so far in 2018. Explaining exchange rate changes after the fact is a lot like explaining stock market changes after the fact – they are easy to rationalize after the fact, but if anyone really knew how to predict them accurately, that person would be a trillionaire. Somewhat humorously, Mr. Eichengreen links to an article that gives 17 possible reasons (with links to sources for many of them), which is essentially the same as giving none.

Finally he says the most likely explanation is just uncertainty. Foreign investors just don’t know where the U.S. and its economy are headed, or that it will continue to be the rock solid safe haven it has been for the past 50 years. This sounds about right to me. Foreigners have been willing to stuff U.S. dollars under their mattresses for 50 years, in the last couple decades with low or even no returns, and some may have decided it is time to diversify.

beating the war drum

This article from The Intercept explains how the U.S. government and media often fail to examine the motives of foreign leaders, and this is one reason we keep making mistakes that lead to war.

That power is called cognitive empathy, and it’s not what you might think. It doesn’t involve feeling people’s pain or even caring about their welfare. Emotional empathy is the kind of empathy that accomplishes those things. Cognitive empathy — sometimes called perspective taking — is a matter of seeing someone’s point of view: understanding how they’re processing information, how the world looks to them. Sounds unexceptional, I know — like the kind of thing you do every day. But there are at least two reasons cognitive empathy deserves more attention than it gets.

First, because the failure to exercise it lies behind two of the most dangerous kinds of misperceptions in international affairs: misreading a nation’s military moves as offensive when the nation itself considers them defensive, and viewing some national leaders as crazy or fanatical when in fact they’ll respond predictably to incentives if you understand their goals.

The second reason cognitive empathy deserves more attention is that, however simple it sounds, it can be hard to exercise. Somewhat like emotional empathy, cognitive empathy can shut down or open up depending on your relationship to the person in question — friend, rival, enemy, kin — and how you’re feeling about them at the moment.

It is important to understand that the leaders of these countries are often terrified of the United States. Iran, North Korea, and to some extent China are almost certainly afraid of the United States. The Soviet leadership was terrified of the U.S. in the 1980s, a fact we didn’t appreciate fully until after the fact.

Understanding this doesn’t mean the United States can’t compete and defend itself against threats. It could help us finds ways to reduce tensions that ultimately lead to a safer world for everyone.

sarcasm, knowledge and creativity

I’ve always preferred to keep my news and entertainment separate, which has always made me mildly uncomfortable with comedy news purveyors like Stewart, Colbert, and Oliver. But there is some evidence that better informed and more creative people are drawn to sarcasm. From Smithsonian:

Sarcasm seems to exercise the brain more than sincere statements do. Scientists who have monitored the electrical activity of the brains of test subjects exposed to sarcastic statements have found that brains have to work harder to understand sarcasm.

That extra work may make our brains sharper, according to another study. College students in Israel listened to complaints to a cellphone company’s customer service line. The students were better able to solve problems creatively when the complaints were sarcastic as opposed to just plain angry. Sarcasm “appears to stimulate complex thinking and to attenuate the otherwise negative effects of anger,” according to the study authors.

The mental gymnastics needed to perceive sarcasm includes developing a “theory of mind” to see beyond the literal meaning of the words and understand that the speaker may be thinking of something entirely different. A theory of mind allows you to realize that when your brother says “nice job” when you spill the milk, he means just the opposite, the jerk.

Read more: https://www.smithsonianmag.com/science-nature/the-science-of-sarcasm-yeah-right-25038/#QlY3dyz2ZcXfK45p.99
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I remember that after living abroad and returning to the United States, the all-pervasive sarcasm and irony in our media and culture is one thing that really struck me. And while living abroad, I found I had to tone down my ironic tone because people from other cultures often didn’t pick up on it, at least at first.

“all criminal roads led to Trump Tower”

  • Here is the New Yorker article on the Steele dossier. Basically, it exposes the largely successful Republican attempts to discredit Steele as pure propaganda. The truth is that Steele is an ex-British civil servant with no ties to U.S. politics, who runs a private investigation agency specializing in the Russian government. Apparently, it is common for politicians to hire private investigators through law firms in a sort of double blind arrangement, where neither the politician nor the investigator knows who has been hired or who is paying the bills. That is what happened in this case. First an anti-Trump Republican hired a law firm which hired a U.S. private investigator who hired Steele, and later the DNC and Hillary Clinton campaign took over paying the bills. The Clinton campaign never knew they were paying Steele, and Steele never knew who was paying him. The information he dug up was shocking, basically that Trump and his associates have extensive ties to Russian government and organized crime figures, and they are at least in a position to be blackmailed if they are not actual Russian intelligence assets. Steele took this information to the FBI, who started and supposedly are continuing a serious counterintelligence investigation. So the information in the dossier appears to be credible, and both the FBI and Robert Mueller special counsel investigation have it and are following up. So if Trump is a Russian spy, he is going to get nailed.

The article is long, but keep plugging through it and you come to the fascinating story of multiple investigations Steele has been instrumental in, including the one that brought down FIFA. And those investigations, which are completely disparate, keep leading back to Trump Tower.

Steele might have been expected to move on once his investigation of the bidding was concluded. But he had discovered that the corruption at fifa was global, and he felt that it should be addressed. The only organization that could handle an investigation of such scope, he felt, was the F.B.I. In 2011, Steele contacted an American agent he’d met who headed the Bureau’s division for serious crimes in Eurasia. Steele introduced him to his sources, who proved essential to the ensuing investigation. In 2015, the Justice Department indicted fourteen people in connection with a hundred and fifty million dollars in bribes and kickbacks. One of them was Chuck Blazer, a top fifa official who had embezzled a fortune from the organization and became an informant for the F.B.I. Blazer had an eighteen-thousand-dollar-per-month apartment in Trump Tower, a few floors down from Trump’s residence.

Nobody had alleged that Trump knew of any fifa crimes, but Steele soon came across Trump Tower again. Several years ago, the F.B.I. hired Steele to help crack an international gambling and money-laundering ring purportedly run by a suspected Russian organized-crime figure named Alimzhan Tokhtakhounov. The syndicate was based in an apartment in Trump Tower. Eventually, federal officials indicted more than thirty co-conspirators for financial crimes. Tokhtakhounov, though, eluded arrest, becoming a fugitive. Interpol issued a “red notice” calling for his arrest. But, in the fall of 2013, he showed up at the Miss Universe contest in Moscow—and sat near the pageant’s owner, Donald Trump.

“It was as if all criminal roads led to Trump Tower,” Steele told friends.

So there you have it. It appears Trump is an international criminal mastermind, a Professor Moriarty, except that Professor Moriarty never got himself elected Queen.