Africa: Second Weekend

We get to have a little fun for our second weekend, while the clinic director would no doubt like us to work I don't think the staff would appreciate this at all.  The plan is to go to a safari lodge in Botswana and then see Victoria Falls.

Our trip gets off to a bumpy start.  The clinic director is driving us in the IVV van, like a lot of machinery out here the van is not in perfect condition.  First of all, the interior door handle is broken requiring that it be opened from the outside, or through a window.

Second, the starter doesn't work well requiring the van to be pushed.  On the way to the clinic director's house we stall on the dirt road requiring that we get out and push it, along with several other people who see the problem and volunteer to help.  The stretch of road we're on is short so we have to alternate between pushing it forward and in reverse several times before it starts.

Starting the car, African mission style.
 
After seeing his new house, we get back in for the hour drive to the border.  Because of political issues, the border area is shared between Zambia, Botswana, and Zimbabwe (with Namibia not far downriver as well) and Zimbabwe is opposed to a new, modern bridge that would allow trucks to bypass the old Botswana-Zimbabwe bridge and vetoes the project, we need to cross by ferry.  We are told this is expensive, around 50,000 kwacha ($10) a piece.  It turns out to be 3000 kwacha per person.

Once there, it is obvious a bridge is badly needed.  Dozens of trucks are pulled over on the side of the road on the way up, that is in addition to a large parking lot full of trucks off to the side.  We are told that it often takes two weeks for a truck to be able to cross.  This is partially due to the lack of a bridge, while there are up to four ferries operating at any one time they are insufficient for the traffic and prone to breakdowns, but the primary reason for the delay is the time it takes paperwork to be processed.  I assume that it is possible to have some of this done in advance or to pay a bribe, but I am never given specific information as to how this works.

Crossing over involves getting on one of the ferries after a truck has already been loaded onto it.  Sometimes they try to take two trucks, we're delayed for a bit while waiting for a second truck to back off one ferry because the two trucks combined are too big to allow the ferry gate to close.  There doesn't seem to be much in the way of safety standards.

It is quickly obvious that Botswana is better off than the parts of Zambia we are in.  There is more construction, roads seem a bit better developed, and everything just looks a little more modern.  Botswana is definitely doing better than Zambia, though we see signs of development in Zambia as well.

We do the standard tourist things for the next few days.  We go on a water safari and a driving safari.  We go on a hike along some trails by Victoria Falls (I dislike heights and it is really obvious safety standards aren't up to par, some areas only a few feet from the cliff's edge have nothing but a chain a few inches off the ground barring the way, in some places there isn't even a chain).  We're a bit surprised to see that people are bungee jumping off the old railway bridge between Botswana and Zimbabwe, we're here only a couple of weeks after that woman's cord had snapped on the very same jump.

Ayo looking out at Victoria Falls (since she asked why I didn't mention her more in my blog entries).

Someone far less afraid of heights than I.  This is the same bridge this happened on.

 
Outside the falls is a small souvenir market.  The remarkable thing about this little place is how much different it is from shopping in Zimba.  In Zimba, while it is possible to negotiate, the normal thing is to just take the price given, just like how we shop in the US.  At the souvenir market at the falls, and in Livingstone, the merchants act differently.  We get told long stories, merchants offer to bargain for our socks or pens (which they don't really actually give a discount for, the clinic director is with us and comments on how many cheap pens he was able to get), and starting prices are absurd.  I find the experience exhausting.

Later we stop by the Shah's for dinner.  We are told the Shah is the richest man in Livingstone.  He runs a construction business and had some involvement with the clinic's construction.  He had visited our clinic for an exam earlier in the week and since he was acquainted with one of the doctors invited us there for dinner.  Unlike the rest of the house's we've seen in Zambia the Shah's house is entirely modern and comparable to anything that can be found back in the US.  It also has several Mercedes parked in the compound (it is a bit different from most western houses, there is an exterior wall and several buildings within) so it's actually a lot nicer in many respects from the vast majority of houses I've been in.  We have the best Indian food I've ever tasted.

After dinner we leave for Zimba, though we lose two people who are having to return early.  While there are two less on the team, we also have an extra passenger for the ride to Zimba, our driver saw someone he knew on the street and offered him a ride.  To digress for a moment, I do see high degrees of trust and cooperation in Zambia, which is notable as a bit of refutation of more simplistic notions of social capital.  Though a more complete discussion of the topic would acknowledge that the social capital literature distinguishes between trust between individuals with some connection and trust between strangers which complicates the comparison.

Some Praise for the Republican Primary Electorate

I've seen more than a little criticism of the Republican base for its failure to settle upon Romney.  This is in some ways justified but I think it misses an important aspect of the race that I've been observing.

As a follow up from yesterday's post, I'd like to note that I think the Republican base has been very clear about what it wants.  It wants a candidate to provide a viable plan that will allow American's to plan for their old age when they can't work, obtain medical care without being forced into bankruptcy, compete in business with wealthy elites with middle class starting capital, and help their children compete with elites in school without government intervention.

The Republican base's attitude comes out rather strongly in a New York Time's article "Even Critics of the Safety Net Increasingly Depend on It":

“I don’t demand that the government does this for me,” he said. “I don’t feel like I need the government.”

How about Social Security? And Medicare? Can he imagine retiring without government help?

“I don’t think so,” he said. “No. I don’t know. Not the way we expect to live as Americans.”

This pretty much sums up what I think is animating the right wing and is being expressed in the Tea Party movement.  There is a feeling that the need for government has been produced by flawed policies and that there must be some combination of policies that will allow us to reduce the role of government while still allowing us to live as Americans.

All of the Republican candidates have been sensitive to this need, perhaps the most forceful expression of it was Herman Cain's 9-9-9 plan.  Very radical suggestions have been made that the candidates promise will allow us to return to the kind of growth and upward mobility that marked earlier phases of our history.

Despite the grandiosity of these claims, the Republican base eventually becomes disenchanted with each one.  A candidate can promise the moon but once the initial enthusiasm is over the hollowness of these claims is understood.  None of the candidates have so far made a convincing case that there policies will provide what the base is demanding.  The base deserves credit for recognizing the weakness of these arguments and for rejecting each proposal in turn.

As I said yesterday however, I don't believe there is any combination of policies that will provide the base with what it wants.  Social mobility in previous eras was provided either by a sectoral shift out of agriculture towards higher productivity sectors or by a vast expansion in educational obtainment (and this was the result of government intervention).  Neither option is available today.

This makes me strongly doubt that there is any policy solution that will fulfill the base's desire.  But they can't be faulted for not having accepted this, we all grew up being indoctrinated in the idea that the market will naturally provide greater mobility if we let it.  We also hear the same thing from candidates on both sides of the aisle.  Despite the rhetoric, however, I just haven't seen a convincing case made that the rhetoric matches with observable results.

What Americans Want vs. What's on the Menu

As I've been reading numerous articles on the beginning of the Presidential race I've been struck by what I see as a continuation of a basic American idea of the social contract.  What American's want is the same thing that I used to say distinguished Americans from Canadians back when I lived in Canada and was more right leaning.  This is that we accept greater risk in exchange for more growth and a better opportunity at succeeding.

While this is what the vast majority of Americans want, it doesn't seem to be what we've been getting.

This social contract and belief that America is all about accepting greater risks in return for greater rewards and more flexible, more mobile society seems to have formed the basic dividing line in American politics.  On one side are those that believe the problem is that we still haven't taken on enough risk to gain the rewards, just a little more risk, a bit higher chance of going bankrupt or getting seriously ill without sufficient treatment, will push us back onto the virtuous path of accepting more risk and getting the wealth, mobility, and creativity that comes with taking a chance.

On the other side are those that look at the extra risks we've been giving ourselves and just don't see any return.  We were told that welfare reform would mean less poverty because people would work harder, but all we see is that poverty has become more pro-cyclical, in good times we have even more in the workforce and spend less, but in bad times we have even more poverty and end up spending more through less efficient programs. Lower taxes doesn't seem to have led to more job creating investment, instead land and stock prices seem to have been bid up with little or any additional investment in machinery.*  The rich got inflation and everyone else just got priced out of the market on real, job creating capital.  This side is beginning to question the story, maybe the trade off between risk and reward just isn't there, maybe the efficiency/equality trade-off is a myth, and all the additional risk and increased incentives has done is make it more likely for us to fail and more firmly ensconced the wealthy at the top of the pyramid.

This isn't to say that anyone has abandoned the American preference for accepting more risk in the hope of greater rewards. It remains very American to lionize risk and encourage entrepreneurship.  But it just feels more and more like the flip side of this is what is getting gutted. A big part of American entrepreneurship has been our easy bankruptcy laws and a sense that we'll help pick someone back up when they fail.  But increasingly it feels like reforms have been in the direction of enhancing risk by increasing the rewards for winning and kicking those that fall down. 

To a considerable extent, this seems to me to embody the current political polarization in this country.  On the right, there is an increasing ideological conformity to assert that the basic American social contract is correct and true.  We MUST believe that accepting greater risk means greater long term rewards, if we haven't been seeing that it's because the government has somehow interfered with us actually accepting more risk and exposure to the market.  This side seems to spend a lot of time explaining why we should ignore inconvenient data rather than trying to adapt their beliefs to the doubts more and  more people are expressing.  The doubt about the validity of this story is what is influencing a lot of RINOs and moderate Democrats to become disillusioned with modern politics.  We just don't believe that the tradeoff implied in the basic American social contract describes the actual world we live in.  Previous attempts at increasing risk through market exposure just doesn't seem to have the consequences we were told it would.  Why should we believe another round of this will fair better?


What we are left with is those that favor their belief and commitment to the basic American social contract vs. those who pragmatically feel that this just doesn't describe our world anymore.**  One side is far more vocal and passionate, and the other is larger but not passionate at all, feeling more disgust than commitment.  We badly want someone to excite us, but our basic feeling is that what we want simply isn't an available option and we can't much decide between anything that's left on the menu.

Bias in the News: Fox News and Climate Science

I know that beating up on Fox News isn't exactly sporting but I just couldn't resist this.

Compare the opening of these two articles:


Climate scientist admits stealing docs from conservative think tank

Theft, deceit and outright lies: How ugly can climate science get?
Prominent climate scientist Peter H. Gleick relied on deceit and subterfuge to solicit a cache of sensitive internal documents from conservative think tank The Heartland Institute before leaking them to the press -- a fresh scandal that further darkens the highly charged debate on planetary climate change.

Climate Skeptics See 'Smoking Gun' in Researchers' Leaked E-Mails

Hackers broke into the servers at a prominent British climate research center and leaked years worth of e-mail messages onto the Web, including one with a reference to a plan to "hide the decline" in temperatures.
The Internet is abuzz about the leaked data from the University of East Anglia's Climate Research Unit (commonly called Hadley CRU), which has acknowledged the theft of 61MB of confidential data.
Climate change skeptics describe the leaked data as a "smoking gun," evidence of collusion among climatologists and manipulation of data to support the widely held view that climate change is caused by the actions of mankind. The authors of some of the e-mails, however, accuse the skeptics of taking the messages out of context, adding that the evidence still clearly shows a warming trend.

While no one seriously thinks that Fox News if fair and balanced, they could at least try to pretend not to be the mustache twirling villains of left wing fantasies.  With coverage this obviously slanted regarding virtually identical methods of obtaining information they're doing nothing but supporting some people's paranoia regarding bias and control of the media by business elites.

Africa: Second Week: Hospital Tour

The next couple of days after our tour of Mulaweya were fairly routine.  The crowds finally began to thin out, there was less of a crowd on the porch (the photo I had posted of people waiting was actually from Friday, this is how thin it became, it was much more crowded earlier in the week) and we started finishing closer to five then six and were able to take a longer lunch.

One of those long lunches we made good use of by going on a tour of the Zimba Mission Hospital.  Before IVV built the clinic about 10 years ago volunteers used to work here, one of our team members is a founding member of IVV and had volunteered at the hospital before the clinic was built.  There is a small property dispute between IVV and the Wesleyans over the land the clinic is built on.  The eye clinic is right next to the new outpatient clinic, the Mission Hospital claims it is built on their land.  IVV had believed when they built it that they would own the land.  Everyone agrees that the land the guest house is built on is owned by IVV, but that is little comfort if the Mission Hospital decides it needs more room.

The hospital consists of several one story buildings.  The newest building is an out patient clinic that was scheduled to be operational next Monday.  They had been using it as a waiting area since we arrived, starting Monday it was supposed to be an initial contact point for new patients as well as where many outpatient procedures will be done.  They offer a fairly wide variety of services in the outpatient clinic, including HIV testing, TB testing, medication dispensing, and physiotherapy. 

The various hospital buildings are linked together by concrete walkways.  There are several surgical suites, a cafeteria, some offices, a maternity ward, a general ward for men and another for women, and an isolation ward.  Most of the buildings are in decent condition, though not up to modern standards.  The isolation ward gets the biggest reaction from the doctors, while separated from the other wards the windows are open in the building and there is little to make it different from the other wards.  My understanding is that the ward is primarily used for illnesses such as cholera.

One of the general wards and the nurse that agreed to give us a tour.
 
One unusual feature of the hospital is that it includes housing for the staff.  Separate from the main hospital buildings are a number of small homes.  They appear to be of pretty good construction, they are modern looking and seem to be decent sized by Zambian standards.

Unfortunately we don't have more pictures of the hospital, my girlfriend had the camera and became distracted by the cats we saw on the hospital grounds.  We didn't see many cats in Zambia, there were far more dogs, all of which seemed to be of the same breed and were brown and medium sized.

The cats which distracted us on a hospital walkway.

Why Not a Progressive, and Separate, Tax on Capital?

This idea is the result of a curious mashup of reading about the Ming Dynasty, industrial revolution, state collapse, and poverty, but it seems to me ideal to tax capital and labor separately, and progressively, at the same rates.  It baffles me that this isn't suggested more often.  Why not treat capital income completely separately from labor income, each with equal progressive rates (corporate taxes are already nominally taxed at progressive rates, I have individual investors and sole proprietors in mind here)?

There are numerous benefits from this.  First of all, it would encourage people to diversify their assets.  An individual receiving most of their capital gains from illiquid assets like housing is severely disadvantaged relative to someone that receives a portion of their gains in smaller amounts through dividends and stocks.  Divesting illiquid assets such as housing would be disadvantaged since this would lead to high tax liability in one year relative to a regular income stream from other capital assets.  This would encourage money being put to work in productive enterprises rather than tied up in bidding land prices up.

It would encourage low income households to invest at least some of their money since this would enjoy a separate tax schedule and presumably standard deduction.  While a poorer person may not gain much tax advantage from the 15% capital gains rate, they gain a significant advantage if interest income from stocks and bonds as well as capital gains would be effectively untaxed due to existing on a separate rate.  They would face an effective marginal rate of 0.  This also avoids the perverse incentive of the current tax system that encourages the already well off to invest ever more of their wealth, gaining a greater tax advantage with each step, allowing them to pull ahead of the less well off.

In addition it would avoid the current bias of our system towards capital.  Currently, someone that enjoys a high labor income due to investment in their own human capital faces much higher tax rates than someone that primarily invested in capital.  The reasoning behind this looks increasingly thin to me as we gain better knowledge of how the economy worked during the industrial revolution, it increasingly seems that capitalism is a misnomer and that higher incomes among the labor force and linked small scale investment was a larger driver of change than large scale investors and capitalists, including the bourgeoisie (incomes were higher for industrial workers than for artisans, the earlier assumption was that wages were driven down by people being driven off the land which the records don't back up).  This makes a lot of the classical assumptions questionable, the evidence increasingly seems to be that the important competition is that of new firms originated with small investors rather than the Schumpterian sense of competition for outsize returns by a few powerful firms and large investors.  The policy implication is that it is more important to favor labor and new capital formation and that capital shortages are exceedingly unlikely to exist in the real world. 

Separating capital income from labor income means that someone that gets a higher wage will face a comparable tax rate as someone that receives their income from capital.  In addition, a successful wage earner will have an incentive to invest in capital as well since this would be taxed on a separate schedule (and vice versa).  It would also mean that large concentrations of capital face higher marginal rates advantaging hungry new start ups (to some small degree).

That's all I have time for.  I have no doubt there are many complications, there are some big problems with being able to label one form of income another.  However, these problems would mostly exist for new firm start-ups still operating as sole proprietors, not for very high incomes.  Some shrinking of existing brackets would also be necessary since most high earners are currently being taxed on both labor and capital income under current income taxes.  As a separate issue, current tax rules with their myriad deductions would likely interact poorly with this which would require trimming some of these deductions (which we need to do anyway, but it's a separate topic).  Of course, more narrowly we could just make the cap gains tax progressive, but I have a big problem with favoring cap gains over dividends.  There are also some housing issues that I'm aware of.

Anyway, this is a half thought through idea but multiple lines of evidence are converging to make me think that our current system is fairly ruinous from a long term economic standpoint.  Capital needs to be taxed at much higher rates than it is today but it also seems important to encourage capital formation among lower incomes and among people who are currently primarily invested in labor.  The current system disadvantages groups such as doctors and other professionals too much relative to groups like bankers, separating income into two separate schedules would eliminate many of the disparities in current tax rates between nominally equal income groups.

On Interpreting Data

The Economist recently had a couple of blog posts about using data to support political arguments.  In the comments there were at least a few allusions to the common notion that data can be used to prove just about anything.

This is true in only the most trivial sense.  It is true that just about anything can be "proven"* by sufficiently restricting the data and by choosing exactly the right level of abstraction to use while discussing it.  But doing this is just silly, human beings are pattern finding animals, we see shapes in clouds and Jesus on our toast for chrissake.  Carefully cherry picking your data and choosing an arbitrary level of abstraction is equivalent to saying that you can see a face in a rock if you stand on your hands, angle your head just right, and squint with one eye.  While this may perhaps give the appearance of a face, it compares poorly to a statue where you can tell that the rock is a face by sight, by touch, by measurements, and by many other approaches to the available evidence.  The image produced by one particular method is likely random chance, the image that can be detected by multiple methods is far more likely to have been produced by intent and to be what it is said to be.

This basic approach is what is meant when it is said that an idea or theory is well supported.  It is true that if data is carefully selected and an argument is carefully enough made you can make the data look like just about anything.  This is the intellectual equivalent to needing to squint just right.  However, it is almost impossible that a false image can be generated through multiple distinct approaches.  An idea that is supported by comparative evidence, by modeling, that is independently arrived at by multiple fields (like economics, sociology, and political science all agreeing), that remains true under multiple different levels of abstraction, that remains visible under multiple different sets of assumptions, that has survived testing by multiple independent teams, etc. is like the face in a statue that can be detected by sight, touch, measurements, etc..  Multiple lines of evidence mean that something is likely true, and the more independent lines of evidence the more likely it is to be true.  If an idea is instead only asserted by one group, uses an extremely restrictive set of assumptions, lacks agreement with other fields, uses a high level of abstraction, lacks independent confirmation, etc. it is almost always going to be BS.

Now, the contrast in the social sciences is rarely as clear as my above example.  We're dealing with worn statues here, not perfectly preserved pieces.  But keeping this in mind does give a rough and ready approach to the validity of various arguments.  Generally, the better argument will be the one that is adding data to the discussion rather than trying to reject it,** the one that suggests new approaches, the one that uses less restrictive assumptions, the one that is less abstract, etc.  Approached in this way it becomes fairly easy to assess the validity of various arguments being made with only a fairly cursory knowledge of the subject.  Someone that has the confidence to suggest reading widely and deep and that can point you towards multiple fields to gather evidence is fairly likely right.  Someone that denigrates other approaches and tries to tell you to use their interpretation or you're doing it wrong is probably wrong themselves.

Now, a separate issue is what we should do with the data once we've agreed on a rough and ready way of interpreting it and moved past the idea that all data is equal.  But that is for another post.