Sunday, November 26, 2017

Against Drug Prohibition

There are numerous posts on this blog that argue against drug prohibition. Here I am trying to gather the concepts from those scattered posts into one long-ish piece. Having read everything I can find about this topic, I have found the arguments for drug legalization to be overwhelming. Indeed, I have had trouble finding a serious argument in favor of drug prohibition ("serious" by my own not-exactly-strict standards). Basic economic theory provides a powerful case that drug prohibition will fail. Theory aside, our actual experience with drug prohibition has been an unmitigated disaster.

"Basic economics?" you say. "Make something more expensive and people will do less of it, right? Prohibition should work according to basic econ." I think this is the starting point for most people who favor prohibition. What it misses is the cost imposed on the people who continue to use and the people who stop using. Of course, you can deter a few marginal drug users by increasing the cost of drug use, say by imposing legal penalties on use or driving up the market price with supply-side interdiction. But such a policy is only "working" in the narrowest possible sense. To "work" in the sense of passing a cost-benefit test, someone has to tally up the harm done by the policy and seriously compare it to the supposed benefit. One cannot simply claim some deterrence has been achieved (no matter how minuscule) and claim victory.

An important insight here is that "prohibition" doesn't mean "you can't do it anymore." It is more realistic and more useful for analysis to think of prohibition as raising the cost of certain behaviors. These behaviors, namely drug use/production/transportation/sale, still happen. It's just that the users/producers/mules/dealers incur a higher cost. Obviously these things are still worth doing under a prohibition regime. It's important to keep track of exactly how much higher the cost is, who is paying it, and how much society as a whole benefits. When people continue to engage in the prohibited behaviors at a higher cost (as compared to the cost if the behavior were legal), it's possible that this "higher cost paid" swamps the supposed benefit from whatever deterrence it achieves, making the policy as a whole a net loser. As we'll see, when the prohibited behavior has inelastic demand, which almost certainly describes drug use, it becomes overwhelmingly likely that the costs of prohibition exceed the benefits.

There are two major rationales for drug prohibition: paternalism and externalities. The "paternalism" line of reasoning is that drug users are irrational and simply don't know what's best for themselves. They don't appropriately factor in the harm caused by their drug use, the thinking goes, so there is a role for government in discouraging their drug use. Under the "externalities" argument, drug users cause harm to innocent third parties who have no say in the drug user's choice. Drug users themselves may or may not be rational, but their choice to use drugs benefits them at the cost of society at large. They do things like go on a public rampage or drive intoxicated. Society has a legitimate interest in deterring these behaviors, even if we reject the paternalistic idea that we should protect people from themselves.

In addition to these, there are also some less-than-serious rationales for drug prohibition. "Drug use is just wrong" or some variation of that theme comes to mind. It's hard to take such assertions seriously. I'd be on equal footing if I asserted "No it isn't." We'd be equally matched in a standoff without ever having discussed any material facts or presenting any actual arguments. Is coffee "just wrong"? How about legal drugs like alcohol and tobacco? If illegal drug use is wrong because it's inherently wrong to break the law, doesn't legalizing drugs solve this particular problem? Someone who dips their toe into this line of argument quickly finds himself arguing that the wrong-ness of a drug depends on the pharmacological consequences or the social acceptance of the drug, which are empirical questions. And once you admit that something is an empirical question, you've completely neutered the "just plain wrong" line of reasoning. If you're mistaken about the pharmacology of various drugs and the related social harms (which I believe are routinely grotesquely exaggerated), then you're likely to be mistaken about the "just wrong"-ness of those drugs.

There are of course other rationales. You could come up with a longer list, depending on how thinly you slice them. But most are some subset of the paternalism and externalities arguments.

Against Paternalism

It is almost impossible to make drug prohibition "work" for the users themselves. When government threatens that it will fine, harass, imprison, and beat people if they use drugs, they are not doing these people any favors, even granting that they manage to deter some proportion of them from using.

To see why, you have to think clearly about how much you are raising the cost of drug use, and realize that the continuing users continue to pay that cost. You can think about the amount of drugs consumed being some function of the total price. Now, it doesn't matter that users "pay" in multiple ways for their habit: part of the price of drug use is literally the money that chances hands, part of the cost is time and effort spent finding a dealer, plus the pharmacological risks of harm, the risk of legal penalties, social stigma, opportunity cost for the time spent intoxicated, etc. These things are all different and would be measured in different "units," but you could (for the sake of analysis) collapse it down to some dollar figure, or some "total risk of mortality", or "years spent incarcerated," or a portfolio of several kinds of costs. Let's imaging coming to some agreement on the "exchange rates" between these different kinds of costs and put them all on one scale, and let's convert everything into dollars. (This is just a simplification. My argument does not depend on actually doing this, nor does it hinge on agreeing on the various exchange rates.) We can create a function, a curve that tells us how much people will buy at a given price. Economists call these functions "demand curves." See here for a pretty thorough treatment in a previous post.

Suppose there are N total users if the price under legalization is $X. Imagine that drug prohibition doubles the cost to $2X. Demand follows some kind of inverse function of the price. So, for example, doubling the price reduces the number of users to half, and quadrupling the price reduces the number of users to 1/4. Under this demand function, drug prohibition is a wash from the point of view of the drug users. Increasing the cost to kX dollars reduces the number of users to N/k. You always get a total cost of $NX. Ramping up prohibition doesn't avoid social costs; it just means that you have fewer users paying a much greater cost. It's a wash from the point of view of the users, but probably a net loss when you factor in the cost paid by society to enforce prohibition (unless we assume the externalities are implausibly large).

It's probably worse than this, because demand for drugs is relatively inelastic. That means users are relatively unresponsive to price changes. It takes a large increase in price to achieve a modest decrease in demand. In the previous paragraph I was using a f(k) = 1/k type of curve, which describes a demand curve that's neither elastic nor inelastic. This curve gets you something like a ~1% increase in price causes a ~1% decrease in demand. Very inelastic demand means it takes more like a 3% or 10% increase in price to get a 1% reduction in quantity demanded.  Demand for drugs probably looks more like f(k) = 1/sqrt(k). Quadrupling the price will get you half as many users, but each is paying four times the cost. There is a net loss for the users themselves, and once again probably a net loss to society as a whole (factoring in enforcement and other costs). The total cost (to users) actually rises as we increase the penalty for drug use. Hammering users harder doesn't produce a Drug Free America. It just means that we needlessly penalize a shrinking but increasingly desperate population of addicts.

The chart below is a graphical demonstration of what's happening. Moving to the right we see increasing drug costs, reflecting stricter enforcement. The quantity consumed (red) decreases while the cost per user (blue) increases. Multiplying these quantities gets you the total cost "paid" by drug users, the green line, which increases as drug enforcement gets stricter.


(The three curves are on different scales with different units, but that doesn't matter. The result that the total cost to users rises as the penalties for drug use increases. These aren't the intersecting supply-and-demand curves that you see in Econ 101, although the red curve actually is a demand curve.)

I have seen attempts to measure the elasticity of demand for various drugs. I've seen ranges of estimates in the 0.1-0.3 range for heroin, perhaps a bit more elastic (0.3-0.7 range) for cocaine. I don't know how much to trust these empirical estimates, so I won't dwell on them. But it makes intuitive sense that people who compulsively use addictive drugs, or who pay a very large opportunity cost to indulge them, probably have inelastic demand.

It's worth keeping in mind that the analysis above is totally sanitized to remove any trace of human misery. The ways that prohibition increase the price of drugs include throwing people in jail, SWAT-raiding the residences of suspected dealers (often terrorizing their families), subjecting users to dangerous black-market supplies of substances that aren't inherently dangerous, depriving families of a parent or earner, and so on. Abstraction is useful, but it's also useful to step away from the abstraction for a moment and remember we are capable of making moral judgments, too.

The drug user isn't literally a logic-machine, crunching the numbers and converting "probability of incarceration" into dollars in some great decision-making calculus. But s/he's surely doing some approximate version of this. If you suppose s/he is doing no such thing, then it's worth pondering how the legal penalties imposed on drug use are supposed to affect the behavior of drug users. It's fine to claim that people are to some degree irrational, but to dismiss any and all response to incentives is to admit that prohibition is futile. I think it is special pleading to claim that drug users are highly responsive to legal penalties while they are at the same time immune to considerations of the other kinds of costs.

Against the Externalities Rationale

A more plausible rationale for drug prohibition is that drug users cause "externalities." They operate a vehicle while dangerously intoxicated. They engage in irrational, violent behavior while under the influence. They commit property crimes to finance their addictions. And so on. I have a long post here discussing this rationale and explaining why it's probably wrong.

For one thing, the externalities supposedly attributable to drug users are grossly exaggerated. These socially destructive behaviors do occur for sure, but they are so rare that it becomes almost implausible to blame the drugs themselves for the behavior. Since there are overwhelmingly more drug users who are not engaging in these kinds of anti-social behaviors, a more plausible story is that poor impulse control causes those behaviors, or perhaps poor impulse control exacerbated by a drug habit.

For another thing, the anti-social behaviors blamed on drug use are already illegal. They are already penalized, and the drug user is already factoring these risks into the decision to use or not use. As I said in my previous post on this topic:
Assuming the penalties for these crimes have been appropriately set, drug-induced criminal behavior is *not* an externality. The potential drug user already faces the threat of a penalty, and moderates their drug use accordingly. It is the same as a potential CO2 emitter facing a perfect carbon tax while choosing how much to emit. The external cost is already internalized, so it ceases to be an externality. That’s not to say there is no harm. When the air is polluted or there is an unnecessary death or beating, somebody surely is harmed. It's just that the polluter (or criminal) pays the social cost of the harm. Suppose we had an appropriately high carbon tax, and suppose drug use induced people toward excessive CO2 emissions. We wouldn’t consider it an “externality” problem or a drug problem. We might adjust the size of the tax to address the problem directly, which is probably what we should do for drug-induced crime.

 If the problem is that people actually don’t understand the causal link, that “crack will turn you into a murderer/thief/assailant with an X/Y/Z% probability”, then the solution is some kind of ad campaign with credible information about these risks. The solution is not a blanket criminalization of drug use.  The potential user with accurate information will grind through the logic: “This habit will turn me into a criminal with probability X, which will almost surely land me in prison for Y years…”(No, he won’t literally do this, but will do so in an approximate fashion.) In this sense drug-induced criminal behavior is already criminalized and the penalty is already built into the cost of doing drugs. It’s already part of the price the user faces. If you object that drug users don’t have the foresight to consider the cost to himself of his future criminal behavior, then you should seriously doubt the entire enterprise of drug prohibition in the first place!  Come up with whatever assumptions you prefer about drug users, their degree of rationality, their behavior, their response to costs, etc.; these assumptions have to be consistent. They can’t contradict each other, which (I think) is what some very confused, very sloppy drug warriors have done. You don’t get to assume that drug users miscalculate the pharmacological risks of drug use but correctly estimate the legal risks. Either their talents for risk-estimation are well-calibrated, or they are not.
Perhaps the large social harms from drug use are due to things that aren’t criminalized. Things like neglect of one’s family or career are either not criminalized or are under-policed. If anyone is proposing we criminalize these behaviors, please suggest a proposal that makes sense, one that doesn’t further destroy the family. Clearly throwing a borderline negligent parent into prison has some harmful ramifications for his/her children, and throwing the same parent in prison on a drug charge has the same effect. If we’re not going to criminalize Behavior A, it makes little sense to criminalize Behavior B which (again tenuously) causes Behavior A.
It turns out that my analogy to an appropriately set pollution tax is a little bit off. In the case of a tax on an externality, society as a whole is compensated for the harm done. A tax serves the dual purposes of compensating the polluted and deterring the polluter. You still get some pollution, but the harm is compensated. In the case of a drug-induced murder or other crime, society at large does not collect the value of the penalty imposed on the criminal. So taking as a given the notion of "drug-induced crimes", the externality is not as fully internalized as it is in the case of a pollution tax. This concept will be important in the discussion below.

If the goal is to deter anti-social behaviors, the appropriate policy is to directly penalize those behaviors. If the penalty for theft and other property crimes is too low, increase it. If the penalty for intoxicated driving isn't sufficient, either increase the severity of the penalty (unlikely to work in my opinion) or increase the probability of being caught (much likelier to work). It would be incredibly inefficient and unfair to target the dozens of drug users who aren't bothering anybody just to deter the one who is. Given the extreme heterogeneity in people's drug habits, labeling a drug as "the cause" of someone's problematic behavior is dubious at best.

It's also worth pointing out that many "drug related" externalities are actually the product of prohibition, not an effect of the drug's intrinsic pharmacology. Intravenous drug use is probably a function of the high market price of heroin and cocaine. The communicable diseases (HIV, hepatitis, etc.) common in communities IV drug user would never have happened if people had access to cheaper drugs, and in fact these diseases dropped off dramatically when needle exchanges started to operate in many cities. (Bear in mind that these needle exchanges were officially illegal, but were tolerated once it was overwhelmingly evident that they were helping.) Likewise, most "drug violence" is actually violence related to the illegal drug market. You just don't see this kind of violence in the market for alcohol...outside of the 1920s when it was actually illegal. If we're going to have an honest accounting of "drug-related externalities," let's put some of the blame on prohibition.

A Tax Beats a Ban

Putting aside all of the above about the "paternalism" and "externalities" stories. Suppose there is a rational reason to deter drug use. Even admitting this, there are better policy responses than prohibition. You can simply place a punitive tax on drug use. The basic intuition here is that in the case of a tax, society collects the value of the punishment imposed on drug users. In the event of a ban (entailing legal penalties like jail time), the cost imposed on drug users is a dead-weight loss to society. You can harass, jail, or flog drug users. But unless the punishers are exceptionally gleeful sadists, nobody benefits from the harm imposed on users.

We'll start with a little bit of basic econ. Don't worry if you get lost in the following discussion; I will try to restate the point clearly in plain English at the end. The formalism isn't necessary to "prove" anything; rather it is intended to discipline our thinking and show critics that their criticisms are being accounted for. The figure below shows intersecting supply (red) and demand (black) curves. The upward-sloping red line, the supply curve, captures the idea that as the price increases, suppliers will want to produce more to sell at the higher price. The downward-sloping black line, the demand curve, captures the idea that as the price increases, buyers will buy less (discussed at length above). Ultimately, suppliers and buyers will agree to a given price and quantity, where the curves intersect. Quantity Q will be sold at price P. If too much is produced, suppliers would have to sell the excess at a loss. If too little is produced, unmet demand will lead to high market prices and encourage more production. There are reasonable debates about whether this model perfectly captures the realities of a market economy. But surely something like this equilibrium is going on. There are forces pushing the price to P and the quantity to Q, and any deviation from this equilibrium will induce market forces to nudge us back to point (Q,P).


The above chart assumes no externalities, no costs to third parties. But now we can suppose that drug use causes significant externalities. Now there is a divergence between the "marginal private benefit" (felt by the users) and the "marginal social benefit" (felt by society at large). Drug users consume too much because they aren't factoring in the costs to others. Effectively society is "subsidizing" the habits of drug users by putting up with all of their anti-social behavior, without being compensated for it. That looks something like this:

The solid black line is the demand curve faced by drug users. The dotted black line is the demand curve for society as a whole. The difference between the two captures the notion that users are "free riding" on everyone else. Users are consuming the higher quantity Q_act, while the optimum for society as a whole is Q_opt. (By the way, MSC is "marginal social cost", MPB is "marginal private benefit", and MSB is "marginal social benefit". The private benefit is higher than the social benefit because the users aren't factoring the costs to third parties into their decisions.)

What's needed here is some kind of policy device that forces drug users to feel the social costs of their actions. A tax or legal penalty will lower the solid black line, ideally until it overlaps the dotted black line.

This lowers the amount of drug use from Q_act (from the previous figure) to Q_opt. If this seems convoluted, it's not. Everyone who favors drug prohibition is following some version of this logic: penalize a behavior and you get less of it.

If we're trying to shift the demand curve, a tax is strictly superior to a ban. We can divide these intersecting supply and demand curves into several areas, each of which has a specific interpretation.

In the untaxed/unpenalized world, the MSC curve intersects with the MPB curve (around Quantity =11 and Price = 10, the point of area E in yellow). A+B+C+E represents the consumers' and producers' surpluses. The producers earn a profit above and beyond their production costs, because otherwise they wouldn't bother to produce anything. The consumer values the goods and services at some value above and beyond what they pay for them, otherwise they wouldn't bother to buy anything. Thus we get the "double 'Thank you'" in market exchanges, in which the consumer values the goods more than the money and the producer values the money more than the goods. Unfortunately, there's more going on here. Society at large is subsidizing users and dealers. Areas C and E represent a transfer from society to drug users and producers, not a surplus for society as a whole. Area D is a dead-weight loss. It is the amount by which the cost of production exceeds the social value of the thing being produced. So areas C and E are a transfer (a wash for society as a whole), A and B are true surplus, and D is a loss. The total surplus is A + B - D

Now suppose we impose legal penalties. The marginal private benefit (MPB line) is lowered to overlap with the marginal social benefit (MSB line). The supply and demand curves intersect right around Quantity = 9, Price = 7.5, where the points of triangles A and B meet. Drug users still enjoy a consumer surplus of A, and producers a surplus of B. We've eliminated the dead-weight loss of D, and the transfer represented by triangle E doesn't happen. Area C  now represents a cost that is paid by drug users and producers, but which does not get paid to anyone. A legal penalty is equivalent to imposing a tax on drug users and then throwing away the revenue. The total surplus is now A + B - C. This might or might not be better than A + B - D from the no-tax-no-penalty world discussed in the above paragraph; it depends on the relative sizes of C and D. But we can do better.

Now suppose we impose a tax on drug use, rather than a legal penalty like harassment, imprisonment or flogging. Once again, we lower the MPB line so that it overlaps with MSB line, and again we intersect at the point Quantity = 9, Price = 7.5. Drug users and producers still enjoy the surplus of A+B. Area C is not a pure loss as it is in the "penalty" regime; it is a transfer. Tax revenue is collected and is not thrown away. Areas D and E disappear from this calculus, because drug use has been reduced to the socially optimal level. So we end up with a surplus of A + B. This is strictly better than A + B - C or A + B - D.

Strictly speaking, a tax beats a ban.

Anticipating some objections to this line of reasoning. One is that a tax "just isn't severe enough." Imprisoning someone is pretty harsh, while paying a surcharge at the pharmacy doesn't seem so bad. Of course this objection would be nonsense. The tax can be arbitrarily severe. Doubling the price doesn't seem to do the trick? Okay, then quadruple, or sextuple, or octuple the price.

Another objection is that prohibition is of an entirely different character than a tax. To purchase an illegal substance, you need to find a dealer, which may require a categorical decision about your lifestyle. On the other hand, a tax just means you shell out more money. That's fine. In addition to a tax, we can impose "user licensing." In addition to paying a surcharge that increases the market price of drugs, users must pass an onerous licensing process. Once again, this is a continuously and arbitrarily adjustable lever with which we can increase the cost of drug use. If the half-day drug safety seminar isn't sufficient, make it a week-long boot camp. The graduate can purchase pharmaceutical-grade heroin. But they have to show they've learned proper hygiene and safety, things like "don't mix with other drugs" and "how to clean your works". User licensing might actually manage to meaningfully inform some drug users of the risks, something that current policy has utterly failed to do. And with a clean, legal supply, there will be far fewer accidental overdose deaths.

Importantly, taxes and user licensing are "high probability" deterrents. The chance of getting caught, much less serving any actual time, is pretty slim for a typical user or even a typical dealer. This deterrent might be sufficient for a typical "risk averse" individual. But the personality type that is attracted to potentially addictive drugs is probably not risk averse. These people are probably risk neutral or even risk-seeking. They obviously enjoy a certain kind of thrill. Deterrence is more effective when the probability of punishment is high, particularly for risk-neutral and risk-seeking personalities. Ramping up the severity of the penalty quickly bumps into diminishing returns. For a given "expected punishment" equal to the severity of the penalty times the probability of getting caught, we're better off trying to raise the probability of getting caught than in ramping up the penalty. (Citation needed. I don't know a lot about this, but have heard criminologist Mark Kleiman say this. Megan McArdle also discusses this at length in her book The Upside of Down, and Alex Tabarrok has made this point repeatedly at Marginal Revolution. I'm trusting that the impression they gave me on this point is correct.)  In a tax-and-licensure regime, essentially 100% of drug users get hit with the deterrent. In a prohibition regime, only a fraction of offenders actually get punished. It's almost like our prohibition regime was meant to target middle-class, bourgeois-values kinds of people, the kind of people who you don't much need to worry about developing a dangerous drug habit. And it fails for lower-class individuals, who probably know people with criminal records, can easily find a drug hookup without accidentally asking a cop, and who don't blush at a small chance of a bad outcome, possibly because they have less to lose. Prohibition is poorly targeted to the kinds of people we want to deter. (Of course I'm not saying that anyone is immune from drug addiction because of their socioeconomic class; I'm merely pointing out that socioeconomic class is a risk factor and that there are policy implications for knowing this.)

It's worth considering the consequences of setting the tax or licensing requirements too high. Make the penalties and restrictions on legal use too high and we will simply drive people back to the black market.

The Black Market

A possible objection to the tax-and-license regime is that drug users might avoid the taxes and licensure requirement by buying on the black market. If we just get a black market again, then legalization would be a failure, right?

I think this objection is probably wrong. For one thing, you'd likely have the majority of the drug supply coming from the legal supply chain, unless the taxes were implausibly high. For example, most people buy alcohol from legal grocery and liquor stores, even though a relatively small amount of alcohol is illicit moonshine and home-brewed beer. People can get around the (onerous) taxes and regulations on alcohol, but most don't. For another thing, even if there is a black market operating alongside the legal market, it's likely that the black market would be diverting from the relatively clean and safe legal supply chain. It wouldn't be a clone of the current black market, where people are cooking up who-knows-what in dirty home labs. There is a black market for cigarettes in states that have set their cigarette taxes too high, but mostly this involves smuggling in cigarettes that are legally produced in other states. People aren't growing clandestine tobacco crops or manufacturing super-concentrated synthetic nicotine in secret labs. They are diverting from an existing, legal, (relatively) safe supply chain.

Again, the legalization regime has a clear benefit over the prohibition regime. If policymakers decide that the black market is too big, they have a continuously adjustable lever to tone it down: they can lower the tax or licensure requirements. If doing this means too many new drug users, they can ramp it back up and decide to just live with the black market problem. There is a classic trade-off here. A legalization regime would at least allow us to be honest about the nature of the trade-off and give us more tools to pick where we want to be on the trade-off curve. Prohibition doesn't give us a continuously adjustable lever in the same sense. Sure, you can ramp the penalty up or down, from a year in prison to two years in prison, or anywhere in between, or anywhere outside of that range for that matter. But prohibition ensures that the entire trade is dominated by the black market. The shift to "100% black market" that we get under prohibition is categorical, not adjustable. You fundamentally cannot adjust this without legalizing the market.

Supply Interdiction

The above analysis mostly talks about targeting drug users themselves with jail time or punitive taxes. But the harshest punishments and most enforcement resources fall on suppliers. Illegal drug production usually triggers severe mandatory minimum sentences, measured in years or decades of incarceration. Transporting or merely possessing large amounts of drugs usually triggers similar penalties. The above analysis still applies. Supply interdiction doesn't mean that drugs disappear from the marketplace. It simply means that the market price is higher than it would otherwise be. We can think of supply interdiction as just another means of raising the price faced by the drug user, similar to a tax or a penalty faced directly by the user. Or you can redo the above analysis by shifting both the supply curve and the demand curve. The basic result does not change. (The supply curve will shift leftward to reflect the fact that suppliers will produce less at any given price. The intersection with the demand curve will occur at a higher price and lower quantity, which are the predictable effects of banning something.)

In this article by Benjamin Powell at the Library of Economics and Liberty, there is an excellent explanation of what happens when you try to shift the supply curve for a good with very inelastic demand. See the figure here in the middle of the page. Note the very small reduction in the quantity of drugs consumed compared to the extremely large increase in price. This isn't some trick of drawing the axes on different scales. It is an inevitable consequence of inelastic demand. As Powell explains, hammering drug suppliers harder actually increases their revenue:
The main effect of a supply-side drug war is a large increase in the price of drugs. Revenues of drug dealers equal the price of the drugs times the quantity sold. Because the drug war increases price more than it decreases quantity, the remaining drug dealers have more revenue as a result of the drug war. In the above figure, the drug war costs suppliers the revenue in the blue box, but suppliers gain the revenue in the larger red box. They can use this increased revenue to buy better technology to smuggle drugs into the United States, to buy more and better weapons to fight law enforcement, or to corrupt more judges and police officers.
Of course revenue isn't profit, but this should still be a worrying result for anyone who is pro-drug war.

At his blog The Big Questions, Steven Landsburg explains here and here why it's futile to deter suppliers with penalties. He presents an little economic formalism to explain what happens when you try to prohibit something.

Gary Becker Made Similar Arguments

In a paper titled The Economic Theory of Illegal Goods: The Case of Drugs by Gary Becker, Kevin Murphy, and Paul Grossman, the authors make essentially the same argument I make above. They use more formalism but come to similar conclusions. They also make many other points I haven't touched on. So I'm pretty sure I'm basically on the right track, even if I might have goofed on a detail here or there. I wrote about it at some length here. Basic common-sense economics gets you to the conclusion that drug prohibition is overwhelmingly likely to fail, and some guys who are smarter and more thorough than me got to this conclusion well before I did. I recommend reading the whole paper, or if you don't have time for that my post summarizing it (both linked to above). Some excerpts:
Optimal public expenditures on apprehension and conviction of illegal suppliers obviously depend on the extent of the difference between the social and private value of consumption of illegal goods, but they also depend crucially on the elasticity of demand for these goods. In particular, when demand is inelastic, it does not pay to enforce any prohibition unless the social value is negative and not merely less than the private value.
... 
We show that a monetary tax on a legal good could cause a greater reduction in output and increase in price than would optimal enforcement, even recognizing that producers may want to go underground to try to avoid a monetary tax. This means that fighting a war on drugs by legalizing drug use and taxing consumption may be more effective than continuing to prohibit the legal use of drugs.
…when demand for drugs is inelastic, total resources spent by drug traffickers will increase as the war increases in severity, and consumption falls. With inelastic demand, resources are actually drawn into the drug business as enforcement reduces drug consumption.
I found the following passage absolutely stunning:
The conclusion that with positive marginal social willingness to pay-no matter how small-inelastic demand, and punishment to traffickers, the optimal social decision would be to leave the free market output unchanged does not assume the government is inefficient, or that enforcement of these taxes is costly. Indeed, the conclusion holds in the case we just discussed where governments are assumed to catch violators easily and with no cost to themselves, but costs to traffickers…The optimal social decision is clearly then to do nothing, even if consumption imposes significant external costs on others.
They aren't stacking the deck by making some weird libertarian assumption about inefficient government or massive negative side effects (assumptions which accurately describe the actual real-world war on drugs). And yet they reach the conclusion that drug prohibition almost certainly isn't worth pursuing. There's more. They relax the "inelastic demand" assumption and still find the verdict to be quite firmly against prohibition:
Even if demand is elastic, it may not be socially optimal to reduced output if consumption of the good has positive marginal social value…[some technical details, elasticity conditions, etc.]… It takes very low social values of consumption, or very high demand elasticities, to justify intervention, even with negligible enforcement costs.

…when demand is inelastic, total production costs rise as consumption falls, and enforcement costs rise more rapidly. With inelastic demand, a war to reduce consumption would be justified only when marginal social value is very negative. Even then, such a war will absorb a lot of resources.
Using more formalism than I do above, they also discover the solution of a tax beating a ban:
Our analysis shows, moreover, that using a monetary tax to discourage legal drug production could reduce drug consumption by more than even an efficient war on drugs. The market price of legal drugs with a monetary excise tax could be greater than the price induced by an optimal war on drugs, even when producers could ignore the monetary tax and consider producing in the underground economy…With these assumptions, the level of consumption that maximizes social welfare would be smaller if drugs were legalized and taxed optimally instead of the present policy of trying to enforce a ban on drugs.
There are a lot of other details to that one could discuss here. Several large volumes could be written on how drug policing corrupts political institutions and the police, in a few countries leading to a failed state. Or one could discuss the knock-on effects of incarcerating large fractions of prime-age males in inner city communities and the absolute havoc this wreaks on traditional life cycles and social norms. A related point, volumes could be written about the systemic racial disparities, which are real and have real effects whether they are intentional or not, whether they are motivated by explicit racism or not. Or we could discuss at length how drug policing degrades trust between police and the communities they serve even when they show up to perform a legitimate policing function, like solving a property crime or a murder. Or someone could write several long papers about how black markets encourage violence because they don't have legal means of resolving disputes, and that this violence is a significant fraction of the total violence in our society (at least in the United States; Jeffrey Miron and Paul Goldstein have done some excellent work on this subject). Someone could write a book about how the war on drugs eviscerated our constitutional rights by constantly carving out "drug war exceptions" to the Bill of Rights (Radly Balko's Rise of the Warrior Cop does exactly this). All of these are very important and deserve a serious treatment. What is surprising is that we reach a strong verdict of "drug prohibition fails" without ever considering these very serious problems. Some basic economic reasoning counter-indicates drug prohibition, without even diving into these other topics.

Wednesday, November 22, 2017

What the Internet Looks Like To Me

A man strides into the village square on a very high horse. "You there!" he says, locking eyes with a man. Everyone scurries off, except his target. The mounted man unrolls a scroll and clears his throat.

"'Sorry'?! 'Sorry' isn't good enough. What you have done makes you a terrible person forever. No amount of apologizing can ever..."
"Whoa! Wait a minute! My think wasn't a 'sorry.' My thing was a 'denouncing someone for bad behavior' kind of statement."
"Wait." He reads the scroll. "Aren't you 'John Jackson'?"
"No, I'm Jack Johnson."
"Oh, excuse me." Chuckles. "I do so many of these." Reaches into a large sack labeled "shrill denunciations." "Here we go. Ahem. 'Denunciation not thorough enough! You failed to use strong enough expletives. You failed to frame your denunciation in social justice terms and instead stated it in general, universal terms. You are hereby denounced for an insufficient denunciation!'" Puffs out chest, throws down scroll, strides off.

Some days, this is really what the internet looks like to me. Some people are so deranged with their own sense of moral outrage that they don't even know who their real friends are. I feel like I've seen this toxic behavior poison more than a few friendships.

Wednesday, November 15, 2017

Does the Firm Hire the Workers, or Do the Workers Hire the Firm?

Here is a brilliant post by Steven Landsburg. Even more brilliant is how he distills his point down into a few short lines in the comments:
When labor and management work together to produce an outcome, you can say that the labor hired the management or you can say that the management hired the labor. The fundamental arrangement remains the same regardless of what words we use to describe it.
I love this. Suppose we started out in a socialist utopia. Independent, self-employed artisans selling their wares to willing customers, who are themselves all self-employed artisans. This wouldn't last long. Some of them would realize they'd be more prosperous if they banded together and realized the efficiencies of division of labor. Before long, they'd realize they could hire some highly skilled managers to organize this division of labor. A highly skilled boss with a grand vision for enhanced productivity, plus a track record of delivering on his promises, would make them all much richer. They'd have to pay him a cut of their sales, but with the added revenue gained through organizational efficiency it would be easy to finance this payment.

It's easy to see the world as it is and take it far too literally. "The pizza place 'sets a price' and the customer buys at that price." Well, the price is very much constrained by competition. The pizza place can't just set any old price. It must be within a narrow range such that they'll actually sell some pizzas (not too high) and still cover their operating costs (not too low). Likewise the relationship between employer and employee looks superficially like a power relationship. "The employer offers the worker a salary, hires him, then tells him what to do." It looks to the casual observer like the employer is calling all the shots, but really the salary and working conditions are the result of a delicate balancing act and a series of negotiations of the terms. (This negotiation is sometimes explicit, sometimes implicit.) Employers are paranoid about losing their best employees, and employees are always leaving for better jobs at other companies. They have the power to unilaterally end the relationship if the employer is too abusive or simply not generous enough. If you can only directly observe your world and literally interpret what you see, you might think that businesses and employers set the terms of exchange and tell the customers and employees to "take it or leave it." But if you could also peer into the alternate universe, with initial conditions set to "independent artisans" and watch it break down, you might end up thinking, "Apparently labor and management come together to produce a product in any conceivable reality. No one's really calling the shots, because a similar equilibrium is reached regardless of who initially 'hires' whom."

Think of a stable of professional mixed martial arts fighters. Is the head coach "hiring" these fighters and bossing them around with grueling training regimens? Or are the fighters "hiring" the head coach, paying him for the use of his gym, access to his expertise, access to other top fighters and other coaching staff, and the "brand" of being with a top-notch stable? You can view the head coach as hiring the fighters or the fighters as hiring the head coach, but the reality is that fighter and coach come together to produce a product. (That being exciting MMA competitions.) You may look at the details of these arrangements and say, "In the real world, the fighter almost always approaches the stable and offers them a percentage of each purse," or "The stable almost always scouts out the talented fighters and extends them a deal to train with the stable for a percentage of each purse." The actual details of the arrangement are irrelevant. People are coming together to jointly produce a product and share the revenue they generate together. 

Tuesday, November 14, 2017

Drug Courts and Drug Treatment

There is much discussion of the recent “opioid epidemic” and the possible policy responses to it. I often hear suggestions that we expand drug courts and treatment programs for addicts. My take on this is: Sure, those things would be better than what we’re doing now, but don’t assume they will help much.

Regarding drug courts, read The War on Drugs: and Old Wives Tale by Christine Shuck.  The author’s husband was forced to endure the infantilizing hell that is drug court. He probably got off lucky, actually. He got caught growing marijuana, and production/trafficking charges aren’t usually eligible for drug court. So the life-disrupting hell he endured was a lucky break compared to what most marijuana growers might have expected. Under drug court you don’t go to prison, but you are regularly urine tested. You have to call a number every morning and if your number comes up (actually I think they assigned him a color) you have to report to a location and drop urine. If you fail a drug test or if you fail to make the appointment, you go to jail for a day or two. This happened to him once early in his “sentence” because he failed to call the number that morning when his color came up. The case workers have enormous, arbitrary power over drug court defendants (prisoners?), and they often have limited or no clinical experience or psychiatric expertise. One case worker decided she didn’t like Christine (the author), so she considered making David (her husband, the drug court defendant) live elsewhere. This didn’t end up happening, but I was scratching my head thinking, “On what basis are you making this decision? From what psychiatric literature are you drawing this insight?” David’s legal rights were severely abridged for the duration of his drug court sentence. I wasn’t enough that he merely abstain from drug use (and recall that drug use was not even the original charge against him). He also couldn’t have any alcohol. In fact there could be no alcohol in the house, thus abridging Christine’s rights in addition to David’s. There were periodic searches of his house for such contraband. Christine explains that even if he were out at a restaurant and someone at the same table as him ordered alcohol, David could be arrested on the spot. Do read the whole thing. It’s an appeal to reason by someone who lived through that hell.

Many drug courts do not allow any kind of maintenance therapy, in which you replace one drug with another. They insist on strict abstinence. This is actually incredibly dangerous because relapse is very common among opioid addicts. Strictly enforced abstinence forces people to lose their tolerance for a drug, and then perhaps in a moment of weakness they indulge. Well, they may not understand that their tolerance isn’t what it used to be. This is actually a very dangerous time and (prior to the recent spate of fentanyl overdoses) was a or even the leading cause of heroin overdose.

So if people are saying, "Yay! drug courts, because it's better than what we have now. We can improve things from there in a few years," I can probably get on board. If people are saying, "Yay! drug courts, because they are the optimal drug policy and they really help the people who go through them," then I am extremely skeptical and I want to push back hard against this as some kind of permanent solution.

I should also recommend Unbroken Brain by Maia Szalavitz. It’s another part-autobiography, part-policy-analysis kind of book. Szalavitz has a long discussion of the various kinds of drug treatment programs. She discusses with which ones work and which ones don’t. Szalavitz was herself an addict and describes her experience with a 12-step program. She claims that it worked for her, but cautions the reader not to believe her anecdote in isolation. The literature just doesn’t seem to validate 12-step programs as an effective “cure” for addiction. (I always admire this kind of intellectual honesty. She’s obviously favorably disposed to a treatment that worked for her, but her review of the literature made her skeptical enough that she didn’t mislead her readers.) There are also “tough-love” type programs. The “patient” in such programs is usually confined to severely restricted living quarters. They are often subjected to incredibly cruel punishment, taunted, physically abused, emotionally broken down, or neglected. There are countless horror stories and several successful lawsuits against organizations that hosted such programs. For all the horrors, there doesn’t seem to be any compelling evidence that these programs work. Relapse rates for “graduates” of tough love are similar to relapse rates for alternative treatments or no treatment. Examples include Straight Inc. and Synanon

I mention this because often drug offenders will be forced into “treatment,” and two broad categories of treatment programs don’t work. So don’t expect that some big federal grant for “drug treatment” is going to suddenly cure all the hopeless addicts. It might help a few struggling addicts find a bed at a treatment facility, assuming they are ready and willing to get clean. But this isn’t going to scale up, such that spending ten times as much on treatment will cure ten times as many addicts. I see “expansion of drug treatment” as something that’s likely to quickly bump into diminishing returns.

Unbroken Brain discusses two kinds of "treatment" that actually work: maintenance and harm reduction. Under maintenance you basically give the addict a measured dose of whatever drug they are addicted to, or perhaps a similar drug. Methadone maintenance for heroin addiction, for example. Harm reduction means you reduce the risks associated with drug use. Clean needle exchanges, test kits that confirm the drug is what you think it is, "buddy" systems or safe injection facilities in the event of an overdose, overdose-reversing drugs like naloxone, etc. Most people "age out" of their addiction and clean up by their early-to-mid thirties or so. Under harm reduction, the idea is that you keep the addict alive until they mature out of their addiction. Opioids like heroin and prescription painkillers are basically only dangerous if you overdose. They don't do the kind of cumulative organ damage that sustained heavy drinking or cocaine use cause. So as long as you can keep the addict from overdosing or getting a blood-borne disease like HIV or hepatitis, you can basically sanitize their drug habit. The beauty of harm reduction is that you don't really need some government program with lots of federal funding and coercive control over the addict. Full drug legalization gets you most of the way there, even without government guardrails.

I see the calls for expanding drug courts and drug treatments as a kind of unserious "do-something-ism" by people who are squeamish about actually legalizing the drug market. Really, there is no way to mitigate the most serious overdose hazards in a regime of drug prohibition. If expanding drug courts is one step in a gradual migration toward legalization, I'll get on board out of realpolitik considerations. But it is not the best possible drug policy. I might as well say so clearly. 

Is It Possible To Sell Something At Twice the Market Price?

There was someone I used to interact with on Facebook a lot who was constantly harping on human irrationality. I remember him presenting me with the example of someone taking advantage of a hungry person’s moment of weakness by charging that person twice the market price for a sandwich. I remember thinking this was a silly scenario and needing to know how exactly the seller managed to get such a high price.

Is it a sandwich shop selling similar sandwiches to its competitors at double the price? If so, it’s hard to imagine they stay in business long. And besides, the buyer, weakened by hunger or not, can simply anticipate the higher price and shop elsewhere. Or does the owner charging normal sandwich prices, but spotting hungry customers and jacking up the price at the register? I find it implausible that this strategy will work long, unless there is a monopoly on sandwich-production.

Is it a chance encounter? Am I returning to the office, sandwich in hand, and a hungry, desperate coworker who doesn’t have time to walk a couple blocks flashes me a cool $15? In this case, it’s not clear that the buyer is overpaying. In this market of “desperate chance encounters”, perhaps the price of a sandwich really is $15.

Is someone closely monitoring signs of hunger in its potential buyers, preparing to rush-deliver them a sandwich? Perhaps they have an app, or even malware, installed on your phone monitoring your stomach for gurgling noises. Or maybe there’s a less creepy/illegal version of “predicting when someone is going to be hungry and delivering them a sandwich.” In a case like this (again, under a non-creepy version of "predicting the demands of hungry customers"), the seller is providing a service that other sellers aren’t. A hungry customer might be happy to pay for the added convenience. It’s possible they have higher operating costs to cover, justifying the higher price. Again, the "market price" might be twice as high in this particular market for perfectly legitimate reasons. 

I love hypotheticals. But taking them seriously requires thinking about how likely they are to actually happen. Learning from them requires considering how the answer changes when crucial details are changed. There might be ways to profit consistently and repeatedly from someone's irrationality. Overall, though, the "humans are irrational so markets don't work" line of reasoning misses the mark. It's vastly overplayed.  

Monday, November 13, 2017

My Private Gymnastics Lesson

I recently had my first private gymnastics lesson. It’s something I should have done a very long time ago. I’ve been learning a lot of gymnastics on my own and have made quite a bit of progress. But a coach would have helped my progress happen faster. Learning stuff on your own is very rewarding, but you get very little feedback. While learning my front handspring, I knew that I was landing too hard, landing with my feet too far in front of me, bending my arms, etc. It probably took me six months of tweaking one-thing-at-a-time to land a decent front handspring, and over the next six months I refined everything further. What little feedback I got was stuff like “I landed way too hard,” which doesn’t tell me what thing I did wrong. Did I not keep my arms straight? Did I try to “sit up” and spot my landing? Is there some mysterious detail that’s entirely missing from all the tutorials I’ve seen? I also took video of myself on my phone. This was of limited value. I could tell what I was doing wrong, but not necessarily how to fix it. For example, I knew for a very long time that I was bending my arms when I touched the ground, but didn’t know how to make them stay straight (hint: you have to push hard off your front leg, otherwise your arms will pretty much have to bend). I’m guessing three or four hour-long coaching sessions would have vastly shortened those long, frustrating months.

It turns out my front handspring is pretty much okay. That was a relief. The coach tweaked one detail and I was landing a lot more cleanly. It was my first experience doing anything on real gymnastics equipment. The gym had a trampoline-floor, two floors of intermediate degrees of “bouncy”, and a solid floor. I over-rotated and face-planted on some soft mats on my first few front-handsprings off the trampoline floor. I didn’t know how to prepare myself for the extra boost. With the tweaks he suggested, I was landing cleanly, straight up-and-down with no face-planting.

It turns out I’m also pretty close to my aerial, the no-handed cartwheel. I could do them off the trampoline floor, which allows me to jump a little higher. I still am not quite able to do them on a solid floor. I think my initial back-kick needs to be stronger, and my push off the front foot needs to be stronger so I get a little more height. I’ve tried a few at home and I always have to put my hands down at the end. The coach said I was, “Doing the skill, then putting my hands down.” At any rate, I feel like I’m making progress on this skill just in the past few days, as opposed to making no progress whatsoever for the past year. Score 2 for “get a coach.”

I’m trying to learn the back handspring, too. It’s actually a much simpler move than the front handspring with far fewer details to screw up. But I was lost without a coach. The idea of jumping backwards and landing on my hands is terrifying. You can hurt yourself if you do it wrong. Anticipating that you will hurt yourself, your brain does not allow your body to do the technique properly. The coach had some excellent exercises to get me started. He had me use an object called a “boulder”, which is basically a big curved padded shape that tips you back onto your hands if you commit to the technique. It doesn’t move if you don’t properly commit. If I ever nail this skill, I’ll have to do a “physics of the back handspring post” similar to the one I did for the front handspring. There are similar physics principles involved in both skills. Anyway, I now understand the body mechanics of this skill in a way that I would never have understood by simply watching online tutorial videos. 

I figured out that my shoulder flexibility is really holding me back. I can’t do a kippup (that cool martial arts trick where you kick from your back up to your feet), probably because I can’t reach my hands back behind my shoulders and touch the floor. So I can’t get a good push off the floor with my hands. Likewise, I probably won’t have a good back handspring until I fix this. It should improve my jujitsu, too.

There’s a broader lesson here. “Get a coach” applies to everything. Oh, you’re self taught and can do everything well already? Shut up and get a coach. You can self-teach to an impressive degree, but you don’t know where your deficiencies are. Something else that I’m mostly self-taught in is data science. I really upped my game after my company hired a data scientist who I could actually talk with. Learning is feedback, and you don’t get enough feedback or the right kind of feedback when you self-teach. It would have been well worth a few $60-$100 sessions with such a person, who could have provided me useful feedback and suggest relevant readings and practice exercises. Get some kind of coaching. Get the kind of feedback you're not currently getting. 

Anarchocapitalism and Left Anarchy

I'm currently reading James C. Scott's Seeing Like a State. See this excellent review by Scott Alexander here, and this other excellent review here. It was also a topic of Cato Unbound, the monthly forum of dueling (meleeing?) essays. So far it's very good. Like James Scott, I consider myself an anarchist, philosophically speaking. But he is a very different kind of anarchist. It is very clear from his writings that he is a "left anarchist." He sees free markets and monetary transactions as being the same kinds of power structures as traditional government.

I'm a libertarian in the anarchocapitalist tradition. I see market transactions as voluntary interactions between consenting adults. "But," you say, "Party A really needs what Party B has, while Party B can take or leave Party A. Market power!" I reject this framing. I actually think it means Party B is helping Party A, apparently far more so than anyone else is helping A. If B is the only one helping A, to me this sounds like B is doing A a favor. And if A can simply take their business elsewhere, then B certainly has no power over A. It just seems odd that we should identify the party that is doing the most to help someone and then berate them, accuse them of monopoly, compare them to a dictator, and so on.

To get a feel for the different styles, see this discussion. In that excellent video, David Friedman presents the anarchocapitalist view, James C. Scott presents his left-anarchist view, and Robert Ellickson presents a more traditional classical liberal or libertarian view. (Ellickson wrote the excellent book Order Without Law, which I actually consider to be one of my anarchocapitalist influences. So it was interesting to see him take the "not anarchy" side of the debate.) Paraphrasing Friedman here: James C. Scott's book is the kind of book that anarchocapitalists should like, because it presents a lot of evidence of grand government plans doing enormous harm and going sideways. But he takes every opportunity to remind his readers that he's not one of those icky market libertarians.

Having read ~100 pages into Seeing Like a State and hearing Scott's commentary from this and other talks, I concur with Friedman's assessment. The market-bashing catches me off guard. I find myself often going. "yes. Yes. Yes! That's right! Wait...facile, stilted anti-market leftism? How does that even fit in here?"

I hope to avoid straw-manning, but here we go. James Scott's examples of market/monetary transactions being like government coercion really miss the mark. See the talk from ~15 minutes to ~25 minutes, and see David Friedman's responses just after. Scott points out that everyone gets one vote, but people have very different numbers of "dollars." From this premise he attempts to argue that rich people can simply get their way all the time. Friedman demolishes this argument later in the video by pointing out that a voting coalition can perpetually outvote another smaller coalition. The winning coalition can vote to have all of the grain allocated to itself, then all the paper, then all the electricity, and so on. When people are bidding for goods with dollars rather than votes, they can only spend those dollars once. So while it's possible that the rich will buy up all the flour in the world to make bread and then paper mache for their arts and crafts, it's more likely that the poor will outbid the rich for the frivolous uses of the food supply. It's also the case that rich people do better under government institutions. It simply is not the case that government flattens the playing field for everyone. It is precisely those upper classes who get the better schools and better police protection. When goods and services are allocated based political considerations and skills in manipulating the bureaucratic machinery, it is the upper classes who are best off. (Friedman offers the example of lanes on roads in Moscow that only government officials could use.) I can't quite tell if Scott is endorsing democracy. Maybe that will be clearer in his book, but it would be strange for someone in the anarchist tradition to do so. Maybe he's just talking about the "very small d" democracy of town halls and tribal meetings deciding things as a group, as opposed to a democratically elected government ruling over a large nation.

James Scott offers a bizarre example of "rich people winning the bidding process against poor people." He points out that rich American celebrities might be able to adopt an African orphan, while a local family would have zero chance of outbidding them. This example only makes sense if you see the orphan as a commodity and not as a human being. If the rich family is allowed to adopt the orphan, a voluntary transfer of wealth has happened, vastly increasing the resources available to the child. This kind of adoption reduces the kind of inequality that Scott is harping on. (This is just occurring to me just now: Is there open bidding on the orphan market? If not literal auctioneer bidding, is there actually someone saying, "We need to increase the 'fee' for adoption to charge those rich American celebrities more. Naturally, this will make it harder for locals to adopt these children." I don't know much about the international adoption process. I know there are some shady cash-only transactions, because I heard the details of an international adoption by a family I know. But I'd be surprised if there's a kind of outbidding or "pricing-out-of-the-market" that Scott is imagining.) This is probably his most confused example, but I don't think the other ones he offers redeem his worldview.

I see a few left anarchists on my Facebook page, and I think they are just terribly confused. Reading Scott, who is an intelligent defender of that worldview, doesn't make them seem any more respectable. They seem to object to any form of hierarchical power structure, even one which people enter voluntarily. That is literally the position taken by some Portland anarchists. They responded to the Reason piece linked to in the prior sentence on Facebook, reiterating how much they hate capitalists. (I suppose this is another example of left anarchists going out of their way to remind everyone that they aren't icky market libertarians. "Ew, that libertarian rag is praising us? Slap their outreached hand away! Now!") The very few left anarchists on my Facebook feed are reliably vanilla lefty-Democrats when it comes to any culture war issue or policy fight. If there is a Republican initiative to reduce taxes or cut the welfare state, these people line up with the other Democrats to bash the stupid, unenlightened Republicans. I want to say, "Hey, doesn't 'anarchy' have something to do with not wanting government?" (Leela: "Fry, that's the only thing about anarchy!") This is probably an unfair sampling and there are probably more ideologically principled and consistent left-anarchists. But so far James Scott, as one of their representatives, has failed to redeem them.

I sometimes imagine this kind of exchange between anarchocapitalism and anarchosocialism.

AC: Hey, there's a push to repeal most of the welfare state and sharply reduce taxes and government spending. Smash the state, right?
AS: Actually...I kind of think all that stuff should stay right where it is for now. Until the revolution comes, of course. Once the enlightened Socialist Mankind has arrived, we will not need these government institutions.
AC: Um, okay. Well, when the revolution does come, I can have a factory where I'm the boss, right? I mean, I understand that you don't like these kinds of power structures. But if that's a superior way to get things done, you'll let it operate and not physically attack me, right?
AS: Actually...we'll probably rabble-rouse the workers until they march on your factory and occupy it. There will be no police force to stop them. And if you hire private security, we'll probably arm the workers. You can try it, but your stuff will end up being collectively owned by the workers.
AC: Okay, geez. I didn't realize you 'anarchists' were so keen on using organized violence to reshape society. Sounds a lot like "government" to me. How does non-market/non-monetary allocation work in the anarchosocialist economy? Will I get an allocation of paper and ink to start a pro-capitalist newspaper? I presume there'll be a socialist version of such newspapers. You'll give these similar projects equal treatment, right?
AS: ...
AC: Okay, I guess I give up.

If I get a better understanding of left anarchy, I will attempt a longer "steel man" version of this hypothetical exchange (in which admittedly I am literally putting words into people's mouths). I've read quite a lot of Noam Chomsky and Howard Zinn, so I should have come across the sophisticated version of this worldview. I still feel like I haven't. Maybe James Scott fills that role.

I should clarify that none of the above impugns Seeing Like a State. It's a truly original book, which I am still devouring.

Sunday, November 12, 2017

Data Camp

I have a data-science type of job. I want to take this opportunity to shamelessly plug Datacamp, an online series of courses designed to teach the student about various data science topics and the very practical aspects of programming languages. You can do a track in the Python language or the R language. (There are also SQL courses. SQL-skills are very important as it’s good to have some data wrangling skills, but you’ll need R or Python to actually fit some of the predictive models that make “data science” a real discipline.) 

I thought I was an intermediate-to-advanced R user, but Datacamp really filled in some of the gaps in my knowledge. Like most R users (I think), I am self-taught. I learned the language doing things ad hoc, one-thing-at-a-time. Datacamp forced me to follow a well structured curriculum. You can actually learn to do some pretty advanced things in R without learning the basics. But "the basics" make it easier to write efficient code, readable by other R users. (See this hilarious example of an advanced R users being foiled by the basics. Basics which, by his own admission, he had learned and apparently forgotten.)

There are various "career tracks", depending on the level of skill you want to develop. There is a "data analyst" track for people who are basically Excel jockeys wanting to up their game a little. Then there is a "data scientist" track for people who want to build sophisticated predictive models using the latest modeling methods. There is a lot of overlap, too. If you finish the data analyst career track (which is 16 courses, each taking ~4 hours to complete), you're really not far from finishing the data scientist track (23 courses, 16 of which are in the data analyst track). Once you subscribe, you have unlimited access to all of their courses. Data Camp adds new courses all the time, some of which are extremely similar to existing courses. This kind of redundancy might seem pointless, but it's very helpful to get a different take on the same topic from a different set of instructors (each course is designed and led by one or two instructors). I would have missed quite a lot if I had said, "Meh. This was already covered in that other course." I've officially finished the Data Scientist career track and the (much shorter, overlapping) Machine Learning skills track, plus several unrelated courses. The material is excellent.

The courses are a series of videos, quizzes, and short programming exercises. When I say "short", I really mean five or six lines of programming. It's often fill-in-the-blank stuff. A video will introduce a statistical concept, then an R function that performs a related task. In the next window, you will be quizzed to see if you understand the concept. In the next window, you will have to enter the arguments of an R function, then examine the output. If this sounds like it's too much hand-holding, it's not. Some of the coding exercises took me a long time to figure out, and I still had to cheat. (If you're struggling with a programming exercise, you can ask for a hint. If you still don't get it, you can ask for the full solution and move on to the next exercise. I'm usually proud, but I was not above skipping some exercises. You get 100 experience points if you complete a programming exercise without help, 70 if you complete it after asking for the hint, and 0 if you ask for the full solution. Get to 100,000 xp, and you can cast fireball.)

At any rate, I don't think you're supposed to blow through the lessons and simply move on to the next thing. I think a practical use of Datacamp is more like the following. Go through all the lessons in some skill track in whatever order you please. At this point you don't know everything, but you have seen everything once. You have a mental index, so you can find stuff when you need it and review. When you need to use something (like that cool graphical trick for making vivid bar plots), you can review the videos, slides, quizzes, and programming exercises. You've already done the programming exercises, so your progress on those is saved. If you return to those lessons later, you will see the finished code. You can simply run the parts of the code you want to see and examine the output. The course that took you 4 hours to complete the first time can be reviewed in maybe 1 or 2 hours. Then you can apply your learnings to a cool work project and impress your boss. Or you can simply do spaced repetition and stay sharp on everything. I've re-done some lessons several times, even redoing entire courses.

A few pointers.

Use ?[function name] or (equivalently) help([function name]), which shows you documentation for the function you're using. Use it frequently. Use it even if you know how to do the programming exercise. There are a lot of arguments to any R function. There might be ten possible arguments, but you normally only enter two or three and the rest are handled by default values that you rarely have to mess with. Still, you should know what this function is doing.

Use the ls() function to see what's in your workspace. (Just ls(). It takes no arguments.) For the programming exercises, data and models are already loaded into your workspace. Sometimes these are the products of previous programming exercises. It's really easy to forget what you're working on, particularly if you leave a lesson and come back to it later. Also, some of the more advanced courses give you fewer details about what you're supposed to do. Instead of saying "Enter 'price ~.' as the first argument,  'binomial' as the second argument, and 'diamonds' as the third argument of the glm() function..." it might say "Build a logistic regression on the data, in which 'price' is a function of all other variables." If you forget the context and don't know what "the data" refers to, ls() will show you what's in your workspace. Once you have that information...

Use the str() function on things in your workspace. (Short for "structure", not "string".) If you call it on data, it will tell you what kind of data you're looking at, how many rows, what are the fields, what are the first few elements of each field, etc. If you call it on a model that you've built in a previous exercise, it will tell you what kind of model it is, what kinds of parameters are present, etc. Like I said, some of the advanced courses don't hold your hand as much, so you have to look at what data and model items exist in your workspace. Call ls() to see what's in there and call str() on those objects to see what you're working with.

There's a "run code" and a "submit answer" button, both of which run all of the code in your window. If you want to run just one or two lines, highlight the code and hit control+enter. See what this does, and use str(), head(), and summary() to take a look at any items you've created. This is a useful exercise. It makes you pause and think about what you're doing. Sometimes a single line of code really has several nested functions, the results of which get passed as arguments to the next function, and so on. It's easy to miss what this is doing. It helps to run the intermediate steps in these chains.

Some exercises are really freaking aggravating. Did you know that a filled circle is different from a solid circle? I didn't. But I do now! Anyway, stick with it. I promise you, you'll get over the these annoyances.

You can look at the slides from the videos while doing the coding exercises. This can be important, because often the video introduces a function, which is poorly explained or not introduced at all in the instructions for the coding exercise.

Don't be too proud to Google or check out Stacked Overflow for help. Some of the exercises don't give you enough information, or perhaps they are drawing on a previous, long-forgotten lesson (possibly from a different course, possibly one that you haven't taken yet!). It's fine. Remember you can always take a hint and even show the full answer. You can always do a "post mortem" on these and see where you went wrong by googling the library or functions you're using.

A note on pricing. I paid $300 for a 1-year subscription. They have special deals all the time, so I have no idea what I'd be paying if I signed up today. (I think I narrowly missed some "half-price" special. Oh, well.)  I'll probably renew at least for the next few years. This might sound like a lot of money, but it's trivial compared to the amount it can add to your salary. Maybe Datacamp isn't the right tool for you at this stage of your career. (There are other options like Coursera and Code Academy, but I know much less about these other services.)  But anyone with aspirations of self-improvement and career advancement should be willing to spend a comparable sum for education, accreditation, technical practice, professional development, or whatever. Buy textbooks, do online classes, or do some form of accreditation. If you have this ethic of self-improvement, with the associated willingness to shell out your own cash to achieve it, you will go far. If you take an "I won't do this unless corporate pays for it" attitude...well, then you have a chip on your shoulder and it's hurting your career. Do some self-improvement on your own time and on your own dime, and you can eventually abandon that stingy corporation for a more enlightened one. 

Saturday, November 11, 2017

Does Toastmasters Actually Help?

Toastmasters is an organization that claims to help people with public speaking. Thus the name, as in “Master of the Toast.” They have a standard curriculum, regional groups with weekly meetings, periodic public speaking competitions, and standards for critiquing speeches. In a typical meeting, a person might give a prepared speech and then accept commentary/criticism from the other Toastmasters. There are also short, informal speeches that give people an opportunity to ad lib.

I’m curious if Toastmasters actually helps people become better speakers at all. I know several people who are very active in the program who have not necessarily become better speakers.  I was working on a video presentation with one such person recently. Everyone on this project had a speaking part for the video. I nailed mine on the first take, whereas the Toastmaster required several takes.  Maybe he simply held himself to a higher standard, because he was a Toastmaster? No, he repeatedly made obvious slip-ups on each take. Mine didn’t have any obvious slip-ups. Another person on this project nailed his take on the first try, and a fourth person slipped up and required several takes. On this admittedly small sample, I saw no obvious benefit from Toastmasters. If it's supposed to transform you into a perfectly polished speaker, it failed this person. 

Another active Toastmaster has long, awkward pauses in every one of her presentations. She doesn’t know how to restart after being interrupted. Another tries really hard to be humorous, but this always falls flat. I recently saw this person give a somewhat technical hour-long talk in which they lost everybody in the first five minutes without ever getting them back. Another Toastmaster I’ve seen flounder in various “technical review” meetings (reviewing some kind of complicated actuarial methodology). No amount of public speaking polish will smooth over the fact that you’re struggling to understand the material.

I can see how it might help. Practice is bound to make you better at anything. If you’re paralyzed by the fear of public speaking, Toastmasters can provide you with a safe environment to practice in. I knew someone who spoke English as her second language who joined Toastmasters to improve her deficiencies with English. As far as I can tell, it helped. But overall I’m still skeptical, because I’ve seen too many cases of failure. Maybe a thorough randomized trial, with a “real Toastmasters curriculum” and a “placebo Toastmasters curriculum” would prove that Toastmasters is really awesome and my anecdotes are bullshit. Or maybe mere practice makes you better; perhaps the various Toastmasters checklists and rules for good speaking have nothing to do with it.

Here’s what I think: you need to learn your subject matter. Learn it really, really well. Know it forwards and backwards. Find out where people are discussing and debating it (comment forums, debates on Youtube, dueling scholarly articles, etc.) so you can see where you might get push-back. Figure out when and where people have difficulty understanding it, and practice discussing it with a newbie. Anticipate someone learning it “the wrong way,” show them how the wrong way leads to something obviously wrong, and how “the right way” leads them to something obviously right. 

Here’s something that Steven Landsburg has said about writing, but I think it applies equally well to speaking (from The Big Questions):
The bane of a college professor’s existence is the student who has been taught in a writing course that there is such a thing as good writing, independent of having something to say. Students turn in well-organized grammatically correct prose, with the occasional stylistic flourish in lieu of any logical argument, and don’t understand why they’ve earned grades of zero.
In the other direction, if your writing is murky, it’s usually because your thinking is murky, too. The cure for that is not a series of writing exercises; it’s to master your subject matter.
In my decades of writing for magazines and newspapers, I’ve written some pretty strong columns and some pretty weak ones. In nearly every case, the weak ones were weak because I hadn’t nailed down the logical structure of my argument. A good column comes, almost always, from translating a logical argument into mathematics, filling a pad of paper with calculations to ensure that the argument is solid, burning the mathematics, and translating my understanding into prose. The translation to prose is the easy part. Prose flows easily when you understand what you’re saying. If you’re struggling to “craft” your prose, you’re probably confused.
So I generally advise college students to avoid the English department. If you like to read, read. You don’t need to take classes. Grateful as I am that Professor N., the fact remains that if I hadn’t spent so much of my adult life rereading Richard III, I’d have been reading and rereading something else, maybe not quite as good, but who knows? And if you don’t like to read, play tennis or something instead. One hobby is as good as another.
If you want to take a literature course or two, I won’t begrudge you; just don’t let them get in the way of your education. But for God’s sake, avoid the writing courses. If you want to write, spend a couple of years studying, say, cognitive science. Take an idea that fascinates you, spend a lot of time thinking hard about the fine structure of the idea, and then explain it to your friends. You won’t have trouble finding words. Now put those words down on paper.
Know your subject matter really, really well, have a little bit of empathy for the uninitiated and their typical pitfalls, and the speaking (or writing) will almost take care of itself. There may be cases where sheer charisma or crowd-working skills will save you from your ignorance. But you have to stop and ask yourself, Do I really want it that way? 

Friday, November 10, 2017

A *Continuum* of Public Health

After writing my previous post on "public health", I realized that rather than a taxonomy it might be more useful to think about different dimensions on which these problems can vary.

1) You can easily limit the harm to other people.
2) You can easily limit the harm to yourself.
3) Contagion, non-linearities, and tipping-points are important or not.

Take normal driving and contagious disease as two examples of my "type 4" public health problems. You can't easily limit the harm you cause to other people, and you can't easily limit the harm to yourself, because giving up driving and becoming a total shut-in are extremely costly options. But in the case of driving, the problem scales linearly with the number of drivers. Twice as many drivers, twice as many accidents. Sure, there can be non-linear effects like traffic jams that basically never happen below some threshold. But you don't get one gigantic society-wide super-accident when you cross some threshold of X drivers. For epidemic disease, there are tipping points and herd-immunity effects. Vaccinating Y% of the population could dramatically reduce the spread of disease, not just reduce it by Y%. Creating a "fire-break" by vaccinating an entire geographic region could conceivably contain the disease. 

I think I made it pretty abundantly clear in my previous post that things don't fit neatly into tidy categories. I still think that the term "public health" is overused and essentially without value. It's like a magic phrase that conjures policy implications out of thin air, at least in the mind of the speaker who utters it. Before diving into policy implications, it's important to clarify that some people are consenting to these kinds of risks or deliberately engaging in some kind of self-harm. There are important moral and practical differences between self-harm and harming third-parties; likewise there are important differences between the consensual and the non-consensual. When people blurt out "Public health!" they are ignoring (perhaps deliberately) these considerations.

I anticipate that someone will take my "continuum" framing as some kind of concession. "Ah ha! Everything is kinda sorta public health, because every kind of self-harm kinda sorta has external costs, even if they are incredibly small." This is the kind of thinking that I want to resist. Perhaps obesity and smoking aren't just self-harm. Maybe the prevalence of these things causes people to find smoking and unhealthy eating socially acceptable, thus leading to more smoking and obesity. Perhaps second-hand smoke is a bit more harmful than we realize. I still resist the "public health" label for these kinds of things because doing so obliterates the notions of consent and free choice. If we can slap limits on each others' behavior for every minor annoyance (say, because my smoking increasing the odds of your becoming a smoker by 0.1%, or because your obesity has a similar effect on me), then none of us are really free. I think that below some threshold, it's meaningful to say that some things are private health and should not be subject to public policy. Conceding that the threshold is fuzzy and sits somewhere on a continuum is very different from pretending that threshold doesn't exist at all. 

Thursday, November 2, 2017

Public Health: A Taxonomy

Different kinds of things that are all lumped together as “public health.”  Here is my list of categories in an arbitrary order and with an arbitrary naming convention. Admittedly these categories are fuzzy and potentially ambiguous, as I will discuss below:

Type 1: Your behavior harms you and nobody else. (obesity, smoking, alcoholism's effects on your own body but not drunk driving)

Type 2: Your behavior harms other people, but they can reasonably avoid the risk. (communicable diseases through intravenous drug use or casual sex, smoking in bars)

Type 3: Your behavior harms other people. You can make decisions that will avoid harming others, but the injured parties can’t reasonably avoid the risk. (drunk driving, pollution)

Type 4: You cause harm to other people, but neither you nor they can do anything reasonable to avoid the risk. (epidemic diseases, normal driving, some kinds of pollution that everyone basically consents to tolerating)

I despise the sloppy use of the term "public health" because I think it's misleading. Usually the word "public" somehow means "my behavior effects you" or "this is an intrinsically collective decision." Economists use the term "public goods" to describe things that are under-produced because most of the benefits accrue to the public rather than the producer. And "public bads" (or "externalities") are things for which most of the cost is borne by the public rather than the producer. (Pollution, reckless driving.) These things are over-produced. In fact, economist will say things like, "Public goods are under-produced because the public benefit exceeds the private benefit." There is this explicit distinction made between public and private, at least in the language used by economists. When people say of some crisis, "This is a public health issue!" there is often nothing public about it. What they really mean is that they are looking at a private problem and counting instances of it across a large population. If Johnny eats too many sugary snacks and grows obese, that is not a public health issue. If there are tens of millions of people just like Johnny, it still isn't a public health issue. It's a private health problem summed across a population.

Many things fit into my Type 1 category. Obesity is bad for you, but not especially bad for your neighbors. Smoking mostly harms the smoker. There are some disputed studies on the harms of second-hand smoke, and the harm is surely real. But it's at least an order of magnitude smaller than the self-harm that the smoker does to himself. Any kind of risk-taking in which you don't endanger third-parties goes into this category. Drug use. Riding horses. Skiing. I don't think it's appropriate to call any of these things "public health" because the vast majority of the harm is self-harm (outside of some weird bull-session hypotheticals).

Type 2 public health is different. Your behavior is potentially harmful to other people, but they can make the decision to completely avoid the risk. Communicable diseases in IV drug users is certainly a public health problem. You can build contagion models and do network analysis to predict the spread of diseases. You can mitigate the problem with needle exchanges. You can disrupt the spread of disease by perhaps breaking the connections between different networks of users. If there are vaccines for some of these diseases, you can achieve herd immunity and fire-break effects to lower contagion. This has a very "public health" feel to it. But it's distinct from Type 3 and Type 4 in that anyone can choose not to be in the harmed population. Don't engage in IV drug use (and, presumably, don't have sex with anyone who does) and you've basically eliminated your exposure. Type 2 problems can be analyzed and mitigated using all the traditional tools of public health, but people can willingly eliminate the risks to themselves by not engaging in the risky behavior. Likewise, you can remove yourself from a smokey bar or a roller derby, or abstain from casual sex.

Type 3 problems are things like pollution or drunk driving. You are engaging in a harmful behavior, and the people who you are hurting can't reasonably mitigate the risk. It's unfair to tell someone they can simply avoid drunk drivers by not driving, in a way that it's not unfair to tell someone they can simply avoid HIV if they avoid intravenous drug use and casual sex. It's unfair to tell someone that they could have avoided cancer (or asthma or acute poisoning) if they didn't live near that factory that clandestinely pollutes more than the legal amount. (More on this below; some kind of pollution are unavoidable, and we all essentially consent to them.) There is a "bad guy" in this problem. There is someone harming unwilling third parties, and this someone could solve the problem by ceasing their harmful behavior. I think it's fair to label these problems "public health."

Type 4 problems are what I think of as true public health. There's really nothing you can reasonably do to avoid exposure to the risk, and there's really nothing the injuring party can do to avoid exposing you to it. Think of an airborne epidemic disease, or a waterborne disease in the era prior to modern sanitation. As I said in my previous post:
There isn’t necessarily a villain, just normal people going about their lives within a population exposed to some infection risk. These are situations where it’s nearly impossible to limit your own exposure to the risk or your contribution to the risk. The instructions for the former are “don’t breathe in” and the instructions for the latter are “don’t breathe out”. Or perhaps there is a less extreme possibility such as “become a complete shut-in,” but let’s suppose that’s so impractical that it’s not really an option for most people. These are the situations that truly justify a public policy.
I think of Type 4 as the purest form of public health. Type 2 is close behind, Type 3 next, and Type 1 isn't really public health at all, in the sense that it's not really public. Some people try to verbally convert Type 1 problems into public health issues by pointing out that some government program forces the rest of society to shell out for private mistakes. I'll briefly note that a policy change could convert these "public" problems back into purely private problems, and we should seriously consider making those policy changes.

What about opioid overdoses? I'll discuss pills and heroin separately, starting with pills. These are really Type 1 problems. People imprudently take too many pills, or take them with benzodiazepines and/or alcohol, or take them when they have a medical condition that exacerbates respiratory depression (sleep apnea, obesity). There is simply nothing "public" about it. You could possibly hand out fliers that meaningfully inform people of the risks (as I've advocated many times), and this might plausibly reduce the number of overdoses. But at the end of the day this is self-harm.

If we take the world as it is as a given, heroin overdoses are also a Type 1 problem. There are the Type 2 issues of communicable diseases discussed above. But the overdose risk is self-harm. Maybe some sleazy drug dealer cooks up a batch of low-grade heroin spiked with fentanyl and several of his clients overdose. Maybe the first time this happens it's a Type 3 problem, but once every heroin user knows this is happening it's more like a Type 2 problem. It's something that happens once in a while, and they could avoid the problem by avoiding their exposure to it entirely. Note the qualifier in italics that I began this paragraph with. Next I'll argue that this is a Type 3 problem.

Suppose we don't take the world as a given. Suppose we consider drug policy to be malleable. Under Policy 1, there will be 10,000 heroin overdose deaths a year. Under Policy 2, there will be only 500 heroin deaths a year. Perhaps Policy 1 is a strict regime of drug prohibition like the one in the United States. Perhaps Policy 2 is a regime of harm reduction, decriminalization, even legalization, like we see in several European countries. (Of if you like, perhaps it's the reverse.) Those heroin users are all consenting to some kind of risk. They are all exposing themselves voluntarily to some kind of hazard. (At least initially, before they are hopelessly addicted...if you buy the "drugs dominate the will" narrative of drug addiction.) But someone is causing them unnecessary harm. That "someone" is the voting public. Sure, heroin users consent to the risk in both cases. But in the case of Policy 1 the risk is much higher. (I nearly said "20 times higher" but this would make an unwarranted assumption that the using population is the same under both policies.)

Heroin overdoses aren't a public health problem because someone counted up the bodies across "the public." Heroin overdoses are a public health problem because bad policy has made heroin absurdly dangerous, more so than it would be under a saner drug policy. The bad guys in this story are the drug warriors and the apathetic/ignorant voting public. I'm okay with labeling a problem a "public health issue" if we're willing to talk seriously about how bad government policy has made the problem worse.

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I listed "pollution" as a Type 3 problem, but sometimes it's more like a Type 2 or a Type 4. Suppose there is a factory town. Everyone in town basically works in the factory, or somehow services the factory's workers. The factory emits pollution, which occasionally causes health problems in the community. But nobody wants to sue the factory, because everyone would be out a job if such a lawsuit actually won. This isn't some rogue capitalist secretly dumping waste into a river and poisoning everyone downstream. This is a case of a community consenting to a mild hazard because it's worth the cost. Maybe some people can choose to move away, so it's more like a Type 2 problem. Or maybe people are mostly stuck in the community because they don't have viable alternatives, so it's more like a Type 4 problem. I think auto pollution is more obviously a Type 4. It's hard to avoid being a contributor to the problem, and it's hard to avoid the effects of the pollution. You can try to mitigate it with policies like emission standards or congestion pricing. But with those things taken as a given, everyone pretty much puts up with the hazard. It's not something that one party "does to" another party. It's just a cost of living a life.