July 29, 2010
One of the many podcasts that I subscribe to are the short lectures given at the TED conferences. TED is a non-profit group that hosts multiple conferences each year in which they invite gifted speakers to share their ideas. People from around the world attend these conferences and pay a few thousand dollars for the privilege. The short version of their mission statement is to share “ideas worth spreading”. To help accomplish this goal they select a few talks and release them for free viewing in podcast form, one a day. However, yesterday’s podcast was not an idea I think is worth spreading.
The talk was given by Sheena Iyengar who studies the concept of choice. She lists a couple of assumptions that are more or less culturally American ideals. One, we must make our own choices in order to be successful. Two, more options equals better choices. Three, you must never say no to choice.
She discounts the first two assumptions through studies conducted on both Americans and other cultures. Apparently first generation Asian-American immigrant children perform slightly better on a set of anagram puzzles when they were told their parents had chosen the puzzles for them than American children who were allowed to choose the puzzles they wanted to perform on their own. The second assumption is discounted through a study that shows that people more often than not cannot tell the difference between Pepsi and Coke. Also, those in eastern Europe who have recently come out of communism don’t see the option of multiple brands of soft drinks as a choice, it is one choice, just soft drinks.
All of this so far just tells me that there are cultural differences around the world when it comes to the concept of choice. Great, I already knew that, her attack on the third assumption is the one that gets me really riled up. She points to a study that shows that American parents who have given birth to a baby that is brain dead and given the choice to remove life support or not are more depressed than French parents in the same situation but where the choice is placed in the doctor’s hands. I have absolutely no knowledge about the French health care system but I suspect that the choice is not given to the parents because the state is going to pick up the tab for some if not all of the health care bill.
I would like to see a study done on French parents and ask them if they would like to make that choice or leave it in the hands of the doctor. In a matter of life and death such as this the choice should rest with the parents. It is called taking responsibility for your choices and actions. If you don’t want to make that choice fine, let the doctor choose, but those that wish to make that choice should be able to do so. See what I did there? In my imperialist American mindset I added another layer of choice, oh no!
Maybe I am reading too much into the lecture but it seems like the attack on choice is by implication an attack on the free-market system that generates the ability to choose. She ends her lecture that Americans have a lot to learn from other cultures when it comes to the concept of choice. That may be true but it is the free-market system that generates the ability to have so much choice and has made us the most prosperous nation on the planet. That cannot be discounted away. If you don’t want to own the consequences of your choices or take full responsibility go live in communist Cuba or North Korea and see how you like it. Let those of us who do enjoy the prosperity that choice can bring.
I encourage you to watch the lecture for yourself. Maybe I am over-reacting and reading too much into it. You can watch it here.
If you agree or disagree please let me know in the comments.
July 28, 2010
It would be terribly ambitious to think that I could keep up the pace of making five thoughtful posts a week so I’ll stick to four a week for now. No promises of even maintaining that pace once school starts back up. This is the start of a little feature that I think I cleverly named. What follows are links with a little explanation to various things, side-trails that will take you to interesting, funny, and maybe controversial ideas. If I link to them it is because I think they are at least one if not more of those things.
Penny Arcade is a wonderful blog that has been around for quite some time. Their comic strips are humorous, sarcastic, and the commentary that accompanies each comic is often insightful. Due to the San Diego comic con they have posted a few guest strips. They are an extension of a story told a year ago called Automata and are wonderful. Part 1 and Part 2 of a 5 part series entitled Blood and Oil are available with three more coming.
A wonderful post over at Cafe Hayek on the nature of unintended consequences and how they have become immediately apparent with the most recent financial regulatory reform law.
A beautifully written post over at Joel C. Miller’s blog about Christian living. About how the seeming contradiction of the Christian faith, that we must die in order to live, is not a self negation but instead an exchange for something far greater. He also uses one my favorite C.S. Lewis quotes of all time from the “Weight of Glory”.
The Wall Street Journal’s Real Time Economics Blog has a good Q&A with University of Chicago economist Bruce Meyer about the poverty measure, how we measure poverty is going to change, and his thoughts on both.
I’m really starting to like this Paul Ryan fellow from Wisconsin. He is a Representative from that state and is proposing a solid plan to get this country back to fiscal sustainability. Unfortunately he is facing as much opposition from within his own Republican party as he is from Democrats. Here he is on MSNBC’s Hardball.
July 27, 2010
Seal of The University of North Carolina System
It is just too easy. Greensboro’s News and Record editorial page provides such ample fruit to pick from that I can hardly keep up. In a recent unsigned editorial from last Thursday, July 22, they sadly proclaim that students in the public university system will have to pay more for their education because of state budget deficits that lead to increased tuition. They lay the blame at the feet of both universities for building too many new buildings, which creates more maintenance costs, and of the legislature who they vaguely claim is not doing enough. Enough of what?
As a graduate student at UNC-Greensboro I will be affected by this tuition increase, however, I would lay the blame on something much different. Much is made about the students and families who cannot afford the skyrocketing costs of higher education and then a solution is quickly offered, give more money to those in need, either through subsidized loans or grants. I have never heard anyone in the popular media connect the dots as I am about to do.
Economics 101: there is supply and then there is demand. Many states heavily subsidize the demand for higher education through discounted tuition for in-state students. Think graphically of a downward sloping demand line and an upward sloping supply line that cross so that it looks like an “X”. The subsidy creates more demand, on the graph this would cause the demand line to move towards the right. Assuming supply remains constant, at least in the short term, this should lead to higher prices at the new point where supply and demand cross. In the long run states are trying to shift the supply line to the right by building new dorms and learning halls but that costs money as well. States are trying to keep prices constant and are failing because of budget deficits. Yet the solution often advocated is to subsidize some more. It seems like a case of government failure.
Is all of this subsidization worth it? A new paper by Jay Schalin, from the John William Pope Center for Higher Education Policy, takes a measured approached in answering the question. The infamous answer that many economists love to give, and I must admit that I do as well, is that “it depends”. Schalin says it depends on what the current level of spending on higher education is, what type of education is being subsidized, and what the current economic environment looks like. While he emphasizes caution, that subsidies have some benefits, the last sentence of the paper states that we may be on the wrong side of the curve, that further subsidies may actually limit economic growth instead of helping. I look forward to digging deeper into this paper and I would suggest everyone at least give it a quick look.
I am afraid of the bubble forming in the market for higher education. Similar to what happened in the mortgage and housing markets. I know that here in North Carolina, and I am sure that this is true in many other states, that there is a large emphasis to go to college. It is seen as the panacea to all the world’s ills. I think at some point there will be a sudden awakening to the fact that the calls for ever increasing amounts of aid and subsidization are unsustainable. Then there will be a collapse. My hope is that the bubble slowly deflates instead of suddenly popping.
