I’ll admit to being generous rating this five stars on Goodreads, but it’s a rare delight to find a book on economics to be so engaging. There is even a call out to Terry Pratchett and a couple of quotes by Douglas Adams, two of my favorite (sort of) philosophers. It’s written as a kind of Platonic dialogue, a narrative in which the ‘reader’ (or just some guy with a mild interest in the subject) poses reasonable questions and provides appropriate comments while the ‘author’ offers responses that are informative but not overly detailed or technical. So sure, the explanations tend to be fairly superficial and gloss over nuances, but the basics are here. What are the essential differences between Keynesian and classical economic theories? What’s GDP and how does it differ from GNI? Is inflation always bad? How might problems like unemployment, poverty, and economic inequality be mitigated? Is perpetual economic growth possible? I found it all interesting and about as delightful to read as a nonfiction book can be. If you’re looking for a serious, in depth study on macroeconomics, this isn’t it. But for a clear introduction, this is hard to beat.
The Unbanking of America: How the New Middle Class Survives by Lisa Servon
Taking jobs at a check cashing service in New York, and at a payday lender in California, a professor at the University of Pennsylvania (and a writer and lecturer on consumer financial services) attempts to obtain some ground truth on the plight of financially insecure Americans.
I think it comes as no surprise that a great many Americans are struggling financially. The economy isn’t what it once was. Adjusted for inflation, wages have declined since 1972. Secure jobs with benefits are relatively scarce. Although productivity has increased over the past few decades, most of the resulting benefits have filtered up to CEOs, managers, and stockholders. They no longer trickle down as pay raises or benefits for average workers. Personally, I don’t see how this situation is sustainable. Too many people are living paycheck to paycheck, saving little, and are unable to cover contingencies such as medical expenses or car repairs, let alone luxuries. What may come as a surprise to some is how pervasive economic insecurity is. It’s not just for the poor anymore. It’s now affecting the middle class. Far too many find themselves marginalized in an economy that still hinges on consumer spending. With so many consumers effectively excluded, how can the system endure?
Anyone interested in this subject has seen the statistics. The author of this book goes beyond those to the personal level, showing what the impact is on some of these excluded individuals and relating how they cope. Many have turned away from banks to alternative financial services such as check cashers and payday lenders. When you simply look at the numbers, these services may seem predatory. Paying close to 2% of the value to cash a check, or 400% annual interest on a payday loan certainly seem excessive. But for some, this turns out to actually be less expensive than similar services from traditional banks, which do not offer small, short-term, unsecured loans, and charge exorbitant fees for maintaining low balances and for overdrafts. It’s an interesting read about a subject that I think should be getting more political attention. There is a problem here that needs to be addressed.
What is life? What is intelligence? What is consciousness? Are these possible only in naturally evolved, biological creatures like us or might a substrate constructed of metal, plastic, and silicon allow them? And if it could, if an artificial intelligence did come into being, would its intellect grow such that our minds would seem like those of bugs in comparison? If so, what are the consequences?
These are the kinds of questions Max Tegmark, a professor of physics at MIT, addresses in Life 3.0. He doesn’t definitively answer any of them, of course. No one knows if, let alone how, such an Artificial General Intelligence could be made. And certainly no one can predict with accuracy what changes such an AGI would bring about to us lowly humans and to our civilization. It could mean the beginning of a grand new era for humanity, or it could mean its abrupt end. Several alternatives are explored in this book.
Tegmark argues that because the impact of AGI could be so profound, it is vitally important to ensure that it benefits our species rather than harms it. He, along with a group of AI developers, scientists, and philosophers, propose twenty-three principles to guide AI development, which can be found on the website of the Future of Life Institute (https://futureoflife.org/ai-principles/). Since these were established by consensus, they are fairly generic, pie-in-the-sky kinds of statements, but they seem to be a good start.
Personally, I’m not overly concerned about a robot apocalypse. I have little doubt that AI will continue to improve, and that it will impact us in significant ways—materially, culturally, and even psychologically. I also see no reason why a super-intelligent AGI could not exist…some day. But I see no reason for such a thing to be malevolent or even harmful. By definition, AGI isn’t human, so, unlike us, it should be a rational agent, immune to the kinds of psychological flaws that have been at the root of much of human misery. AGI may increase the rate of societal change and stress our capacity to adjust, but we’re an adaptable species. I think we can cope. There will be those who will no doubt attempt to abuse AGI for personal gain or to pursue a favored ideology. This is a concern with any new technology. It’s a human failing, not an inherent problem with AGI, and for every despot with an enslaved AGI, there will be those of nobler temperament with AGIs of their own to counter him. It seems to me that the very existence of AGI would help ensure that conflicts would be foreseen and mitigated before they become an existential threat simply because there are more people who want to avoid an apocalypse than there are those who wish to bring one about. At least, I hope this is true.
I found this an interesting read. I recommend it.
Soonish: Ten Emerging Technologies That’ll Improve and/or Ruin Everything
by Kelly Weinersmith and Zach Weinersmith
Technological advances can change the world. They have before. Human civilization was significantly altered in the not-so-distant past by indoor plumbing, steam power, and the assembly line. Imagine how different your life would be without electricity, automobiles, computers, and the internet. One can argue about the costs and benefits, but no one can dispute that such things have had wide-ranging impacts on how we live. Innovations like these were the result of brilliant people striving to understand the forces of nature and then inventing new ways to harness them to improve our lives. This process continues today. (If it ever stops, we’re in trouble.)
In Soonish, a husband and wife team (a cartoonist and a biological scientist) explore ten areas that may soon (or soonish) bring about such life-altering changes: cheap access to space, asteroid mining, fusion power, programmable matter, robotic construction, augmented reality, synthetic biology, precision medicine, bioprinting, and brain-computer interfaces. For each of these, they explain what it is, how close we are to achieving it (and why we might not), things to be concerned about, and how it could change the world. It’s not a comprehensive list of emerging technologies nor is it an overly detailed one. It doesn’t predict that these things will happen. It doesn’t promise a brighter future or warn of an impending apocalypse. It doesn’t argue that these things should or should not be pursued. It’s a reasonably objective overview for casual readers of areas that are currently being explored, interspersed with humor and cartoons, and it’s a surprisingly entertaining read. I know I enjoyed it.
Will the availability of Big Data permit the social sciences to collect objective information, test hypotheses, and provide predictions in ways traditionally possible only for the hard sciences? In this book, a bright young economist argues that that the answer may be yes.
The title, Everybody Lies, refers to the fact that people lie, a lot, about all sorts of things. They lie in interviews, on surveys, and even on anonymous opinion polls. They even lie to themselves. Until recently, the best way for social scientists to understand what people were thinking and feeling was to ask them. But because people lie, the information collected was unavoidably flawed. Enter Big Data. It seems a person’s internet searches and online activity are better predictors of their behavior than what they are likely to tell you. Mining such data is becoming not only a powerful tool for the social sciences but also a big business.
Despite the author’s undergraduate degree in philosophy, he doesn’t address the question of whether or not this is a ‘good’ thing. He makes few value calls. He simply demonstrates that these data are out there, and they can be used to understand, predict, and even manipulate human behavior. But there is an an unaddressed ethical question here. Can special interests successfully manipulate human attitudes and behavior for selfish economic or political gain? Are they doing so already? That’s a rhetorical question, of course. Advertisers and politicians have been waging wars of domination for the minds of people for years, but now with Big Data, they’re better armed. My cynical soul quivers at the thought.
Convergence: The Idea at the Heart of Science by Peter Watson
Carl Sagan once said that science is a way of thinking much more than it is a body of knowledge. In Convergence, historian and journalist Peter Watson demonstrates one important aspect of this profound insight. Individual scientific disciplines once regarded as separate are converging, influencing and fueling one another to reveal a clearer and more detailed picture of reality. The findings of geology help answer questions in biology. Discoveries in physics shed light on issues in cosmology. Assuming the existence of an objective reality, science is how we learn about it. A fact discovered by one scientific discipline remains a fact across all. This is why the inability of quantum mechanics and general relativity to play well together is so bothersome. Each works remarkably well in its own realm. Each makes accurate predictions. But if both theories are describing different aspects of a single reality, it means that at least one of them still needs a bit of work. Watson touches on this quest for a unified theory in this book, but it is mostly a broad overview of the science of the last 150 years or so with a focus on how separate disciplines have come together. It’s an informative read.
There’s a lot of pro-capitalist ranting in this book. There’s even some name-calling. It’s hardly a scholarly or objective work. It is, however, a succinct but superficial overview of banking and Wall Street. It reminds us (repeatedly) of the legitimate purpose of banks—saving and lending money. I doubt many people would claim otherwise. What most, including myself, are upset about are the abuses, the clever manipulations, the deceptions—what amount to high stakes versions of shell games and pyramid schemes, and of course, the impact of all these on people who may not even realize they’re in the game.
The root cause of all of these, Cohan claims, is that when investment banks went public (starting in 1970 with the IPO of DLJ), investment bankers could make big personal profits without much personal financial risk. As many have pointed out before, this allows them to privatize gains and socialize losses. “When people are rewarded to take big risks with other people’s money, that’s exactly what they will do. The problem is that the top bankers, traders, and executives on Wall Street collectively no longer have enough of their own skin in the game to make a difference to them when the things they do go awry. They get rich either way.” (page 114) That, he says, is pretty much the only problem. Don’t blame Wall Street per se, the problem is a system that shields those making unwise, even knowingly bad loans from the consequences. Worse, it rewards them for it.
Well, maybe. This definitely is a problem. He doesn’t believe the solution is financial regulation, though. He’s clearly opposed to such things. “The fix for Wall Street should be directed at its compensation system, not at the functioning of Wall Street itself. It’s really as simple as that. Fix the compensation system—make bankers, traders, and executives fear for their art collections, their co-ops, and their homes in the Hamptons—and sit back and watch how quickly it works to change people’s bad behavior.” (page 146) As simple as that, huh? It doesn’t sound simple to me. There are a lot of people, people with power, people with influence, people with heaps of money, who are getting more of all of the above through this system. They’re going to resist attempts to stop this gravy train. I certainly don’t see them doing it voluntarily.
I disagree with much of what Cohan is saying in this book, including a couple of his underlying but unstated assumptions (concerning the ‘value’ of money and the desirability of perpetual economic growth). I do, however, agree that those who make risky investments must be held responsible for their actions. There is no prudence if there are no consequences.