Christmas Time Is Here

Well, it's one week until Christmas. Tree is up. Presents are bought (if not wrapped). Plans made. Much misteltoeing. Kids jingle-belling. Everyone is, indeed, telling you'll be of good cheer.

Here in the Great Garden St, despite the economic mess, people are optimistic. A new regime is going to Trenton in January. Maybe Chris Christie will succeed where Jon Corzine failed.

Why do I sense a bit of grinchiness in the air?

Glad you asked.

On the radio the past couple of days, battling ads are running about a possible vote to "legalise" gay marriage. You see, the lame duck legislature have been debating these past few days whether to extend marriage rights to gay couples. Setting aside that Gov. Corzine has had four years to do this, and that this plainly looks political, I am struck by the general nastiness of the tone of those who putatively are out to "protect" marriage.

Now, I typically tend to lean to the right of Atilla the Hun on most issues, and generally think that the Democratic Party are out to sea - and have been out there for so long that they've long forgotten why the set sail to begin with and the general direction of the land - on virtually everything. My right-wing bona fides are seldom under question. I personally have been called a crypto-fascist by Morton Kondracke, and I assume he does not hand out that badge the way John D. Rockefeller used to hand out dimes.

But on this issue, I think that largely, the conservatives are about as wrong as they possibly could be.

The arguments range from the bizarre and absurd (allowing gay couples to marry will lead to various pairings such as man and goat, or triplings, or others in a smorgasbord of weird permutations) to the sincere and wrong (religious objections).

I honestly do not see how any of these can stand scrutiny.

What is marriage? I don't mean from the sense of playing card games like sixty-six or from a cultural or nostalgic point of view. What I mean is, since this is largely a discussion about government and the laws, what is marriage in the way it is viewed by the State? How it ought to be viewed by the state?

Simply, in my estimation a marriage is a contract between two people that spells out certain privileges and obligations. It's not about love (though a good marriage should have a healthy dose of that). It is a commitment between two parties that they will share debts, legal burdens, be allowed to make certain decisions should the other become incapacitated, who will get what in the inevitable instance that one dies.

That's pretty much it.

The human-goat (thanks Michael Savage for that one) argument is patently absurd, since a contract cannot be entered into by a party that is non compos mentis.

I understand the religious tradition, and even the utilitarian perspective that marriage ought to promote fidelity, stability, and continuity. I've seen the data, and am completely convinced that children are far better off raised in married families. But that's beside the point. Allowing gays to enter into legal contracts will not make unmarried couples less likely to have children out of wedlock, and they can scarcely make the data on illegitimacy or divorce for that matter worse.

From a religious perspective, I go to Mass pretty much every Sunday. My own personal views on morality of homosexuality are irrelevant. What the people living next to me, let alone in California or Maine do has no bearing on my marriage or my views of marriage. Unless one of them is my father in law, I don't really see how they can, and if how other people live their lives somehow undermined the serious regard I have or do not have for the sacrament of marriage then my faith would have to be pretty shallow indeed.

There is a famous passage in the Gospels where Jesus, confronted with the conundrum of whether to pay tax (which the Pharisees viewed as potential blasphemy) or not (which they new was a crime under Roman law), answered by showing a coin and asking whose image was on that coin. When the answer came back Caesar, he famously said that one is to render unto God what is God's, and to render unto Caesar what is Caesar.

From my understanding of the Gospels, he was not saying you should pay your taxes, but rather, that His Kingdom was not of this earth, and things such as money (and by extension, contracts) were of this world. The coin of His realm is the soul, and the wage is how we behave and how we treat one another. Whether you view homosexuality as a sin, He also was quite plain in saying to whom judgment was reserved, and I am pretty sure it's not me.

Frankly, the only real reason I see for anti-gay marriage ads is meanness. I do not know a lot of gay people, but I do know more than one. Some are nice people. Some are obnoxious. Whether or not I think gays are acting according to God's will, I do not see why the government should deny them the basic right to enter into contracts with one another, and to treat those contracts with the same respect as any other.

So this year, at Christmas time, in the time of miracles and of the forgiveness of man (the reason Christ came into the world), instead of puffing ourselves up "defending" marriage and righteousness, let's take a look at how we are living up to one of the few things that He asked when He came to the world.

How are we treating our fellow man?

The answer to that question is far more relevant in my view than any Propositions we sign or lawmakers we call to defend marriage against a threat that just does not exist.

Farming Out the World Series

Tonight the Fall Classic (to be completed in November) begins. Yankees. Phillies. Baseball's all-time winningest franchise (26 titles) versus its all-time losingest (first team to amass 10,000 losses). The Jersey Turnpike Series.

There was an interesting article today at MLB.COM that made the case that money alone does not account for the Phillie-Yankee series; the implication here is that the two teams have more or less gotten to the pinnacle of the baseball world along the same, home-grown model.

In a nut-shell, I wonder what reality the article's author is operating in.

Now, I have great respect for the Yankees' success. The team certainly is a collection of great talents, and winning in New York is not always the easiest thing in the world. The fans are demanding. The Boss is legendary. But friends, the idea that money does not play a role - in fact, an enormous role - is nuts.

I am a mathematician, and in maths, there are two ideas that are complimentary. One is that evidence be necessary; the other that evidence be sufficient. NO ONE is saying that money is sufficient as a criterion for success (c.f., the New York Mets). But it is becoming harder and harder to argue that it is not necessary.

The New York Yankees have the highest payroll, by a wide margin, in professional sport. They also have been in the playoffs in 12 of the past 13 seasons. During that span, the Pittsburgh Pirates, with a payroll that is less than the Yankee infield collects, not only have not made the playoffs, but have not had a winning season since 1993. Ironically, that's also the year that Barry Bonds left Pittsburgh when shown the money by the SF Giants.

The argument in the article is that the Yankee core (Jeter, Petite, Posada, River, Robinson Cano) are home-grown talents.

That much is true.

But the point is, in order to build a winning team, you need more than two or three good players, and those players need to play together to develop. Given the economics of baseball today, to draft three high quality players, you realistically need to get good picks over a period of five years. Those players then need to be "hits" (i.e., they cannot be guys like Mark Lewis or Corey Snider). They cannot get hurt or wash out. And it takes time for them to reach the big leagues, mature, and gel.

There is a reason why New York could keep Jeter and Posada and Rivera, and that the Cleveland Indians could not keep Cliff Lee and C.C. Sabathia. When these players get near their peak value - i.e., when you are in position to build a championship team - they will be going off to New York. Or Boston. Or the Dodgers.

And that ignores the fact that the Yankees are able to add to this "core" with stars like Mark Texeira and Alex Rodriguez when necessary, to fill gaps. Teams like the Yankees sign Johnny Damon. Teams like the Toronto Blue Jays sign guys like Lyle Overbay.

The fact that the Yankees can shop for all-stars is covered to some degree by sports writers. The other side of the coin - that they need not worry about their best players bolting - is not, and I would argue is at least as important a result of the economics of the game today.

2009 World Series by Proxy

Well, it's finally here. The Fall Classic. The Jersey Turnpike Series (Yankees and Phillies) begins tomorrow night (Wednesday the 28th). That's 28th of October, of course, meaning that the games almost surely will be played, by schedule, in November. Who will be the first Mr November (apologies to Reggie Jackson)?

Could not help but notice, the Game One starters are slated to be C.C. Sabathia (Yankees) and Cliff Lee (Phillies), winners of the two previous Cy Young awards...for the Cleveland Indians. The Yankees are a talented team, but looking at the roster, one sees the predilection of Mr. Steinbrenner to collect prize players the way the rest of us collected their cards.

It got me to thinking about the economics of the game as they exist in the early 21st century. My team, the Toronto Blue Jays, also has a prized pitcher (Roy Halladay, himself a prior Cy Young winner) who was the subject of relentless talk this summer about possible trades to the Yankees and Phillies and Boston and a number of other teams. Ultimately, they decided not to cash him in in yet another chapter in the almost criminal incompetence of its now former regime. Due to the economics of the game (a handful of teams - the Yankees, Boston, the Dodgers) have seemingly unlimited financial resources that allow them to plug any perceived gaps, and thus make the playoffs year in and year out (either Boston or the Yankees has been in the post-season every year since 1994). At the other end are teams like Cleveland who from time to time will get in through a bit of luck and development of young talent. Inevitably, they are forced due to the massive chequebooks of the "big market" teams to trade their best talent for a Whitman's Sampler of "prospects" and mediocre veterans.

So, I am very curious at exactly what point the managers and GMs of the talent producers (Cleveland) are going to recognise the reality that it's in their best interests to get as much out of their talent right now, while they still have it, instead of worrying about the mid and late-stages of these guys' careers?

Over the past 30 years or so, the workload of pitchers has been increasingly monitored - first in the number of innings thrown, until now, where each pitch is counted. In 1980, the Oakland Athletics had a staff that averaged 20 complete games per year. This year, Roy Halladay lead the league with nine.

Does that strategy make sense?

Put simply, if you were the GM of the Cleveland Indians, and you had a pitcher of the talent of Cliff Lee or C.C. Sabathia, why would you worry about how many innings the guy throws, when the rent on that is not going to come due until he is in New York, Boston, or Los Angeles? Today, pitchers are kept on more or less strict pitch counts and inning limits, with the recognition that has arisen that a high workload early in a pitcher's career will have an impact when he reaches 30 or so.

But if the future for C.C. Sabathia is in New York, why is that the concern of the Cleveland Indians? If I were the Indians' management, I would want to get 300 innings out of Sabathia every year I had him.

At some point, I fully expect that the small-market teams are going to wise up to the fact that economics and the future are not on their side.

The New New Media

Today got "tweeted" an interesting feed via Twitter (Motto: you cannot spell "Twitter" without "Twit."), from Guy Kawasaki. Normally, I would pass right over anything from a source such as Mr Kawasaki, since he is one of the most infamous of the Apple Cultists.

In this article, Judy Shapiro (a marketing professional for various e-interests) makes a case for salvaging the traditional media (e.g., the NY Times and other print media) in various ways. Not surprisingly, given her job and her expertise, the advice includes the usual bromides about building "communities" of users, making content more "fun," shifting paradigms (maybe Bain and Company have finally triumphed with their cliches and cereal box sophistries), and generally moving away from the expensive and generally old-fashioned, un-hip "push" model for information to the internet model of information "pull" to draw in news "consumers" and ultimately creating not readers, but "affiliates."

I'm willing to set aside the absurd notion that the creation of information for an educated populace of the sort a real democracy needs to function can be created in a sort of ersatz C-Net on Sesame Street, but there is a number of enormous, existential problems here.

What Ms Shapiro and other proponents of the "new" media fail to grasp is that it's not the entertainment value of the 'news' content that makes it vital, but rather, the quality of that information. It's indisputable that the internet revolution, such as it is, has created an enormous quantity of information that can be had for, at most, nominal charge. For those who want to find out what the actual name of the Skipper character on Gilligan's Island was or who played first base for the 1975 Boston Red Sox was, or other such trivia, all are readily available. But this explosion in quantity has not been accompanied by an equal growth in accuracy or wisdom. One need only go to Google, and enter in a search of "Vince Foster" or "Barack Obama Birth Certificate" to confirm that there is a wealth of junk masquerading as news that is equally available. In short, it's the difference between Wikipedia and the Encyclopaedia Britannica.

Gathering news is serious business, and relies on serious, professional reporters. That does not include Arianna Huffington.

Ms Shapiro goes on to argue that the current model (fee for content) cannot work because, ultimately, there are too many "leaks" in the systems - security and other holes that can be exploited. So, once the Times publish something, it ultimately will escape and be had by people for "free."

That may be true, but what is the end-game of the exercise Ms Shapiro is proposing - where 'news' is gathered by 'communities' or 'affiliates?' Right now, when you or I goes hunting for the news on our favourite blog or link, free of charge of course, chances are pretty damned good that if it is real news, then a paid reporter, working for Reuters or the Times or some other such outfit actually dug the information up, published it, and it was picked up and communicated via the various channels that lead to your browser. But if the reporter is gone, that information is going to be gone as well, and thus you will no longer have access, either.

Ms Shapiro's argument is akin to saying that the because there are too many leaks in distributing food, we ought to do away with farms. But friends, as the bumper sticker says, no farms, no food.

Finally, as to the argument about "push" versus "pull" content, and making the news more likely to attract "communities," I would offer the obvious example. Which news outlet saw, during the past 10 years, its "community" grow the quickest? It's an outlet that has re-designed its news "brand" to be more "fun," given its consumers what they want, pulled viewers, and last month, via hidden cameras in various ACORN offices, turned a couple of its viewers into affiliates.

The end game of Ms Shapiro's 'new' media is in fact, already here, and it's not my idea of a high-quality news organisation.

It's Fox News.

The New Math, 2009

It's election season (again). Funny how one fantasy about people passing out free goodies follows right after another (Hallowe'en). Personally, I think it's more likely that the Great Pumpkin will rise out of a farmer's field than that the current crop of slick stooges will raise the country up out of the muck.

Here in New Jersey, we are currently being treated to the very real possibility that a man who has the following baggage may actually get re-elected:

1) zero charisma

2) arguably the worst performance in the history of the state

3) images of his political pals being frog-marched en masse off to prison for

money laundering

4) track record as head of Goldman Sachs, who recently were called a

"blood sucking vampire squid"

He's basically George W. Bush without the aw-shucks charm.

Given that the state is and has been run by a foul ad-mixture of corruption and incompetence perhaps only exceeded by the circus in California, one would expect his challenger would practically waltz into Trenton.

Think again. This is the Soprano State, where political bosses and public employee unions have power perhaps only matched by Johnny Sack. Add in that his main challenger, Chris Christie, is running perhaps the worst campaign in the history of politics, and it's a horse race.

But what's really galling is the impact of the mathematical sleight of hand of independent candidate Tim Daggett, who has slowly but surely undermined Mr Christie's campaign by simultaneously attacking his plan for tax reform, and proposing tax reform of his own through shifting New Jersey's infamously high property taxes to sales and other use taxes.

It's the same shell game one hears every few years. It has appeared before as the "flat tax," and the "fair tax."

The bottom line here is that no tax "reform" is going to work unless and until solid proposals to cut government spending are made. Put simply, think of a five foot bed sheet that must cover a six foot bed. You can pull it up to cover your neck, but you are going to expose your feet. Unless you get a smaller bed or a bigger sheet, something is going to get cold.

New Jersey has usurious property tax burdens - the highest in the country. The effect is that it is driving people out of the state. But if property taxes are reduced by 20 per cent, without cutting spending an equal mount, will require that the same amount be raised elsewhere. So, you'll save a few thousand a year in property taxes, but pay the same amount in sales tax or car tax, or other tax, is going to result in the same tax burden. And worse, these other taxes are going to be more difficult to itemise and deduct elsewhere.

Our state has a budget gap that is conservatively described as 'yawning.' The problem is because of spending; the liberal media (e.g., the NY Times) endorsed Mr Corzine, pointing out among other things that Mr Christie has no 'concrete' plan to fix this problem and laughably, on a few occasions exceeded the $400 per night hotel travel limit.

Mr Corzine not only has no concrete plan to fix the problem, but in fact has a defined record of exacerbating it; he is a hand puppet of the unions, and pensions, out-sized raises, and patronage (Mr Corzine once dated the head of the unions) alarms me far more than Mr Christie's hotel bills.

It remains to be seen if the people in this state are any better at maths than they are at civics.

Dr Stangelove 2009, or, How I Learnt to Stop Fearing Socialism and Love the Public Option

I have always been sceptical of people who support increased government power explaining why this or that further incursion is “for my own good,” or prop up the action by offering that opposition to it must necessarily be due to lack of clarity, or worse, because of propaganda that has obscured. Now that the Democrats appear to be on the verge of passing some sort of health care bill (really, calling a piece of legislation that is physically larger than the Manhattan yellow pages is a stretch), and Speaker Pelosi has said that it *will* include some sort of ‘public option,’ I’ve decided to set aside my worries about Big Government and embrace the creeping socialism.

Before I get into any further detail, I’d like to start with a few clarifications ahead of time.

I think the Republican Party has contributed in a large way to the mess we are in. I voted for President Obama. I do not believe he is a crypto-Moslem plant, nor was he born in Kenya or an illegitimate president. I don’t watch Glenn Beck or listen to Rush Limbaugh. I think Fox News is tabloid rubbish. I do not own a gun, do not think that the Democrats are trying to disarm us and install a Soviet or Nazi regime. I have never seen black helicopters flying over, and am not particularly concerned about the Masons or that a black man is president.

But I do believe that the “public option,” as is being discussed by the Democrat House leadership, is a kind of soft socialism. Using monies taken by taxation from one group of people to redistribute in the form of services to others who have not paid for those services is almost the definition of socialism.

Accept it, and move on.

So, in that spirit, here is what I propose as a sort of sugar (Splenda, perhaps?) to help the socialism go down.

Let’s have a public option. But let’s make it a real option, not something delivered at the point of a tax policeman’s gun.

Let the federal government set up a true insurance scheme, run and administered by government experts. Put whatever rules into the plan that they think will make it ‘work’ (i.e., it must cover this that or the other procedures, cannot charge higher premiums according to actuarial data, cannot refuse care for pre-existing conditions, etc.). Allow it to negotiate fees, prices, and co-pay rates. Give people the option of buying into this system or opting out. The profit motive presumably would be removed, and the only goal of such a scheme would be the health of its participants.

That is what proponents such as Dennis Kucinich and Bernard Sanders argue is the fundamental problem with private insurance, and hence the motive of pushing a public option.

But this public option must be subject to the same rules as other choices. Doctors and other health care providers can freely look at re-imbursement and other factors, and choose not to take patients who use the public option.

And, most important of all, require that this public option be self-sustaining. Put simply, it cannot use tax money for funding, and must be sustained by the premiums paid in by its participants. The bottom line here is, the word “option” implies that one has choices, and that participation is voluntary, not compulsory. I like the current health insurance I have, and I do not want to see my quality of care go down (which it would with the sort of single payer scheme seen in Canada or the UK) and my costs go up (which I suspect they would given what Speaker Pelosi is pushing – expanding “coverage” to 45 million additional people).

The maths simply do not work – you cannot provide the same level of care to a larger group of people without an increase in total cost. And presumably, since these additional 45 million (or whatever number you choose) currently do not participate in the current system because they cannot afford to, they would use resources without contributing a proportional amount of money.

Put simply, health care reform, with a public option, must not be yet another means by which federal kommisars rob Peter to pay Paul.

I propose we go forward with this reform, inclusive of such a public option, and after a period of years, see how it has worked out.

Just the Facts, Ma'am.

If it's 1 PM, Monday through Friday, chances are pretty good I've just returned from my company gym. The hour or so at lunch is one of the few times I am able to set aside and do nothing productive, so I usually go for some exercise, which does little to advance shareholder value, increase the GDP, slow global warming, or put an end to the John-Kate feud. But it does make me feel a bit better, and I guess that has some value.

Today I ran my customary 10 kilometres (around 6.2 miles), completed in 43 minutes and 53 seconds. None of those numbers is particularly remarkable, but I did today cross the 11,000 mile marker. Yes; I keep pretty close track of data - it's, as they say, in my nature. I'm a mathematician, and numbers heavily influence my world. In my life, numbers are a bit like a drop of red dye in the wash; as Homer Simpson discovered when Bart's red hat got in, that single drop tends to colour everything just a bit pink, and so it is with me and data.

As an aside, I took to running almost exactly 15 years ago, following the death of my father from cancer. Part of his grim prognosis was because he was not a candidate for surgery - his lung capacity precluded it, so I reckon, if I get sick, I want to increase my odds as much as possible. In those 15 years and two months, I've now covered 11,001 miles. I thought I would take a look at this milestone by the numbers.

11,001 miles in 182 months is about 725 miles per year.

That works out to about 60.5 miles per month, or 14 miles per week.

The most miles I ran in any one year (1998) was 1154. The most in any one month was 132, in May 1998.

In this current year, I've now covered 664 miles, and hope to reach 850 by year's end.

The earth is approximately 24,000 miles in diameter, so I am not 999 miles from the half-way point. Put another way, if I started at the North Pole, I would now be more than half-way through Chile on my way to the South Pole. Using current projections, I'll reach that point sometime in November 2010.

The best "pace" I've ever set was in March, 1998, when I covered 8 miles in 53 minutes and 13 seconds. Age is obviously slowing me down.

I've run the Bay to Breakers four times (an iconic "race" in San Francisco, California). I've seen, inter alia, naked people, people dressed up as chess pieces, various animals, centipedes, cultists, Democrats, Republicans, and people hauling beer kegs. Because of the staggered start (there are literally thousands of participants, some walking), I usually start after the "winner" is done. One year, I ended up sprinting the last 500 metres or so to pass a guy who pushed a barbeque (you read that right - a round, Weber kettle) the 12 kilos. I'll be damned if a cooking implement will beat me.

My best memory is looking at the Hale-Bopp comet in awe in the Winter of 97-98, thinking that it will not be back for more than a millennium.

I wear out two pairs of shoes per year, so that's 30 pairs of Nikes, New Balance, Asics gel, and Reeboks. I've never tried the froo-froo brands (Saucony, Etonic).

Countries I've jogged in include (in no particular order) Japan, Taiwan, Singapore, the Philippines, France, Germany, Austria, Ireland, and Germany.

All in all, I think, an interesting history for a guy who used to view running as a sort of punishment for mouthing off to the coach in junior high.

Luck Be a Lady

One of the most common aphorisms you hear in a given week is that this or that is "a toss of a coin." Usually, the implication is one of the randomness or vagaries of life. Coin tossing permeates the culture in song, book, and film. Two recent very popular movies ("The Dark Knight" and "No Country for Old Men") feature villains who make life and death choices using a coin - of course, Harvey "Two Face" uses a coin which has two heads, removing any actual chance, but the point is made.

My own academic training is in maths and applied statistics, and it's actually very helpful to reduce almost all questions around probability to variations of the coin toss.

But "randomness" does not imply "luck," and I personally don't believe in luck. A coin will land heads or tails based on a number of physical properties, some subtle (how much air resistance) and some not (when you grab it out of the air), but the process itself is deterministic once the coin is thrown into the air. Similarly, for cards, the shuffle, cut, and deal set in motion a series of events that is not at all based on luck. We think of luck perhaps as whether the gambler chooses heads or tails, takes a hit to 15, etc., and in these perhaps there is an element of luck.

I got to thinking about luck last night as I listened to the Toronto Blue Jays lose yet another late-inning, one-run game. The team has lost more than its share of such games this year (this, plus the lack of budget and hence talent has contributed to yet another dismal finish far out of contention), and I was curious to see just how badly it has done.

The results are remarkable.

In one-run games - games that more often than not are decided by tiny, tiny differences (a ball inches fair or foul here, a single swing of the bat that misses the sweet spot by fractions of an inch there) have an exaggerated effect on the outcome - Toronto is 18-27, the poorest record in the American League. (The California Angels, 27-18, have the best). In extra-inning games, the Blue Jays are 5-12, easily the worst in the Major Leagues.

The question is, is this luck, or something else?

In baseball, Bill James some years ago created what he called the Pythagorean Theorem, which, like the famous eponymous theorem of geometry, estimates a team's winning percentage as the ratio of the square of its runs scored to the sum of its runs scored and runs allowed squared. Put simply, if you score exactly the same number of runs as you allow, over the course of a season, you will win approximately half of the games you play.

What's useful as an exercise here is that teams that win a lot of close games, but lose a majority of the games that are blow outs will post a winning percentage much better than the one estimated by the Pythagorean Theorem. A team that loses a lot of close games, but wins the majority of the blow outs will do relatively poorly.

To convince yourself, consider Team A, which in a series of 10 games, wins 8 games 2-1, and in the other 2 games loses 4-0 in each. This team scores 16 runs, and allows 16. The theorem predicts it should win 5 and lose 5. Given that it won 8, it has won an excess of 3 games.

The idea here is that games that are close tend to be more influenced by random events (the one ball inches foul) than games that are not close. Good teams will win more blow-out games as a percentage than bad teams will. Of course, the good teams will also win a majority of the close games as well, but they tend to win a much higher percentage of the lop-sided ones. If the Yankees were to play the Baltimore Orioles, it's far more likely that the Yankees will win 10-0 than Baltimore. Not in a given game, mind you, but over a long series, the better team will almost always predominate.

This in mind, I looked at how Toronto (and the rest of the AL) had done for the past 5 years, plus this one.

This year, the Jays have scored more runs than they have allowed (a slight difference, but there you have it). They currently are 15 games UNDER .500. The Pythagorean Theorem predicts that they ought to have won 9 more games than they have. That is a serious under-performance.

But is it "luck?"

For the years 2004-2008, Toronto has won fewer games than the theorem predicts IN EVERY SINGLE SEASON. Put another way, they have tossed a coin and gotten five consecutive tails. This year almost certainly will be number six in a row. The "odds" of six straight heads are 1/64, or less than two per cent.

Cumulatively, the team was won 31 fewer games than the runs scored/allowed formula predicts.

Both of these figures are the worst in the American League (the Cleveland Indians are next, having been shorted 26 wins). Oddly enough, the California Angels (this year's best performer in one-run contests) have exceeded predictions in all five years, and this year will certainly make six, unless they lose a couple of games 20-0.

This is not "luck," for a team to be worse, every single year, than it ought to be. The players are different; the opposing rosters are different. Only the GM and management are the same.

I think the evidence is clear, and the prosecution rests. It's time for the management in Toronto to go, from top to bottom.

More on the Cold-Blooded Murder of English

Read a headline this morning; "Warren Buffet: 'Rich Need to Pay More" sent to me by a somewhat liberal friend.

This little fiction was advance further by various and sundry Democrats (e.g., Claire McCaskill [D-MO]), whose job it is, I suppose to conjure up tortured arguments to separate you from your money. Ms McCaskill said "[Mr Buffet] said rich people are not paying enough taxes."

Now, what in fact Mr Buffet said was that the taxes on dividend (and perhaps, other investment income) should be put in line with the tax rates on ordinary income, as a matter of fairness. He used as an example that he pays only 15 per cent on his income, which is largely from investments in, inter alia, Berkshire Hathaway funds, whilst his employees who are wage earners pay at a 25 per cent rate. Now, setting aside that in fact, few people in the lower income brackets (less than 50,000 per year) actually pay the 25 per cent marginal rate, once deductions and the like are taken, it's startling to see how this little proposition (that investment income ought to be treated the same as wage income) is transmogrified into a "the rich need to pay more" argument.

One can agree or disagree about the fairness of taxing income streams differently, and in this, I am in agreement with Mr Buffet, but it's intellectually dishonest to equate these two points. I expect hand-waving from the kleptocratic Democrats in the government. But for news agencies to be so duplicitous is quite alarming.

If the Democrats and Mr Buffet want to debate setting income tax rates of different income streams to parity, that's fine. If dividend income is to be taxed more steeply, then that is going to be done irrespective of the income level of the payor. But that's rather a different thing from saying, essentially, that we ought to raise the top marginal rates, which is the reductio ad absurdum of the "rich do not pay enough" proposition.

Given the shell game that Mr Obama and the Dems are currently trying, I suggest people pay very, very close attention to what they say, and how their words are reported.

Green Day, the English Language, and US Debate

Among other somewhat eccentricities, I'm a fan of the band Green Day. Sort of clashes with my instinctive, right-wing politics and only-feel-comfortable-in-a-suit-at-work personality, but there you have it.

Some years ago, they had a song called "The Grouch," which has catchy riffs and amusing lyrics. Among them, the singers bemoan "Oh my God, I'm turning outlike my dad."

Truer words never were spoken.

My father, who has been gone now for 15 years, used to be somewhat a curmudgeon with respect to the King's English, and most particularly, its grammatical rules. And by "somewhat," I mean that if you dared confuse, e.g., the subjunctive, you would be met with a pained, dismissive stare.

I was thinking of this whilst looking over what passes for a debate about health care reform: the raucous town-hall meetings. The petulance of Nancy Pelosi. President Obama trying to rescue his top domestic policy with a pretty purple speech last night. In all the sturm und drang, the first casualty has been the English language.

What, pray tell, would Professor Higgins, who would have had Eliza Doolittle "taken out and hung (sic)?"

No one seems to know what words mean anymore.

The NYTimes, who have become little more than a lap-dog to the Obama administration, chastise opponents of the President's plan for calling Mr Obama a 'socialist,' saying that there is little resemblance between his plans and the authoritarian raj of the Soviets. Oh, how the mighty have fallen (William Safire is an alum). Surely, they know that socialism is an economic system, and the totalitarian regime of the old Soviets was a governing system. And that ignores the fact that much of our current health care system - Medicare, for example, IS socialist both de facto and de jure.

We have the spectacle of the failed former VP candidate talking about "death panels" when she speaks of the rather mundane task of deciding how scarce resources will be allocated. Whether you know it or not, your insurer, whether private or public, makes decisions every year about what treatments it will re-imburse and what treatments it will not, using cost effectiveness models. Surely, as a Republican, Mrs. Palin understands that the allocation of finite resources to attempt to cover infinite demand is the very definition of economics.

And finally, we have the President of the US and too many others talking about getting "insurance" to cover "pre-existing conditions." Now, the term "pre-existing conditions" is itself so Orwellian as to conjure up an image of a boot stomping on a human face forever, but that's only half the whopper here.

In point of fact, you cannot buy "insurance" to cover a condition you already have. Insurance is a bet that you make, against yourself, that something is going to happen. You make your wager in the form of a premium, and if, by God by grace, you get sick, THEN you collect. The premium is a fraction of what the cost of treatment will be, and you are able to do this because you are pooling your risk. If 100 people pay the premium, perhaps one will "win" the bet.

Buying "insurance" for an illness you have is about the same thing as walking into a casino, sitting at the roulette table, watching the ball land in red 26, and then asking to be allowed to put a bet down on red 26.

That isn't insurance; that is welfare.

All in all, our "leaders" (hmmm, am I guilty, too?) are betting on the fact that the average man on the street is simply too dim to catch the abuse.

A bet that, to paraphrase Mencken, is a sure thing.

One Definition of "Shared Responsibility"

First, a mea culpa. I voted for the current occupant of the White House. I remain glad that his opponent did not ascend to the throne. But I am getting an increasing feeling of buyer's remorse. Here is, inter alia, one of the reasons.

The Democrats are very, very fond of talking about "shared responsibility," and people paying "their fair share." (nota bene the use of the word "share" in each talking point.) What, exactly, do they mean:

http://tinyurl.com/CreditRedux

Yep; as with the housing melt-down, and the spending of tax money like Frank Sinatra on shore leave, those of us who now are foolish enough to actually use our credit cards responsibly - who apparently have been "getting a free ride" - will further subsidise those who don't. Our fees will go up; our interest rates will rise. All so that those who do NOT use credit properly can be cushioned from their own sloth, cupidity, and downright foolishness.

I ask Mr Obama and Ms Pelosi: At what point are you going to stop telling me how much "responsibility" for others I need to share, and start asking those who are getting us into this mess need to share some responsibility for themselves?

After all, when I was in kindergarten, "sharing" involved more than one person.

Stranger in a Strange Land

Life is made of small sacrifices; one of mine that parent-hood brought on was sufficient time to read, which is now a precious commodity. The book I am currently reading, Blink by Malcolm Gladwell, is a journey into the subject of quick decisions and how the human mind parses micro-slices of information.

On page 214 of the book is a discussion of autism and, in layman's terms, describes its impact on the ability to read faces. One of the studies mentioned is by a professor at Cambridge University in England called Simon Baron-Cohen, who is a pre-eminent researcher into autism spectrum disorder.

Now, most people who come across that name would pass over it without a second thought, but if I mentioned another name, Sacha Baron-Cohen, some eyebrows might go up. If I said "Ali-G," a few more would have a glimmer of recognition. But if I said "Borat," virtually everyone in the US between the ages of 18 and 40 would immediately have an a-ha moment.

Simon Baron-Cohen, a world-renowned researcher into autism, is the cousin of Sacha Baron-Cohen, an actor and comedian who created the character Borat.

Small world.

Lies, Damned Lies, and Bernie Madoff

Forget the NCAA Tournament and March Madness - for me nothing can beat the Opera Bouffe that following the financials presents. I came across this little nugget today at Yahoo Finance:

http://tinyurl.com/WeepForTheRich

The piece was written by a man called James Stewart, which is itself rather a bit of an inside-joke, given that James Stewart the actor often starred in films that glorified the little guy in his fight against the plutocrat. This incarnation would seem to favour Lionel Barrymore.

Mr Stewart - the writer, not the actor - raises what I am sure he thinks is something of a defence of the so-called rich, and deploys as his foot-soldiers various numerical arguments. The fulcrums (fulcra?) on which this rests are the suppositions that the "rich" are not necessarily so rich, have suffered more than the general population in the current economic downturn, shoulder a larger tax burden, and are largely not criminals.

Now, most people who have more than the intellectual discipline of a housefly understand that the final point is a straw-man. Of course most of the rich are law-abiding, his plaintive comment: "Yet, as hard as it may be to believe, the overwhelming majority of people earning six-figure incomes aren’t criminals or spendthrifts" notwithstanding. Mr Madoff is a criminal, but the guys over at AIG who approved "retention" bonuses are only criminally stupid, which itself is not yet illegal. We are still waiting on the California Supreme Court to rule on that one.

But looking through the rest of Mr Stewart's opus, there are three essential points.

One, those who are high earners (six figures) have suffered greater losses than the typical man on the street.

The Federal Reserve released statistics last week that showed Americans collectively lost $5.1 trillion of their net worth during the last three months of 2008 and $11.2 trillion for the full year. The numbers don’t break that down by income level, but I think it's fair to say that much of the drop came from the steep decline in stock prices, and stocks are owned disproportionately by high-income people. Indeed, stock ownership is so skewed to upper-income households that the percentage declines are probably much steeper for them, more likely in the 30% to 40% range.

That means anyone who was a millionaire at the beginning of 2008, and had a million dollars invested in stocks, has lost about $300,000 to $400,000, which is in line with what I’ve been hearing anecdotally. And the losses have only multiplied this year as the market continues its descent.

Now, the first problem with this argument is practical. There are not actual data to show exactly how the losses have skewed; Mr Stewart instead says "it's fair to say" that because the decline is largely driven by stock losses, that stock ownership skews to the wealthy, and therefore, losses are "steeper" for them.

I'd like to see the numbers before I agree what is fair, and more important, what is accurate.

It's true that the average guy is less likely to own stock, but he likely does have a pension and/or 401-k, which is intrinsically linked to stock performance. I know my own 401-k is off by about 35 per cent, and my son's college fund has lost about 40 per cent.

Second, he fails to make the distinction between "a millionaire" and those who have "a million dollars invested in stocks." Americans to a large degree are disgracefully innumerate, and do not understand the differences along a scale of someone whose net worth is $100,000; $1 million, and $10 million. The differences are, to say the least, enormous. And when he conflates someone with an income between $200,000 and $300,000 (which comes later) with the jet-set who have a million dollars worth of stock, he is directly playing on this ignorance.

And this ignores the existential issue that the "losses" in this case are largely paper losses. If your stock portfolio drops 30 per cent, you only "lose" that money IF YOU SELL when it is down. So while it is true that Warren Buffet's net worth has declined, he in actuality has not "lost" anything in this regard. In fact, to use Mr Stewart's own implied argument, "I think it's fair to say" that, given the current low stock prices, many of the super wealthy are quietly acquiring stocks at bargain prices that their other assets allow them to acquire, and when the market turns up, they will have grabbed an even larger share of the wealth pie than they had before. To extend the Stewart/Barrymore metaphor, as George Bailey said of Mr Potter, he's not selling, he's buying. In five years, we'll see the endgame of the current situation.

Second, Mr Stewart raises the issue that the rich are taxed at disproportionately higher rates:

This group also pays a disproportionate share of income taxes, even before Obama's proposed tax increases. The top 1% of earners are expected to pay 25% of all personal income taxes this year, and the top 5% to pay 40%, according to Tax Policy Center's latest figures. It's no wonder that the people I know who earn $200,000 to $300,000 are incredulous to be branded as “rich.” They certainly don’t feel that way.

and

By contrast, let’s take a look at the top 400 earners, who in 2006 (the most recent year for which data are available) earned an average of $263.3 million. Now that’s what I call rich. These 400 people paid on average $45.2 million each, and collectively paid a remarkable 1.77% of all personal income taxes that year, the highest percentage since the IRS has been keeping records. They also paid an average rate of just 17%, the lowest ever, largely because of their massive capital gains, which are taxed at a low rate. Presumably those gains will seem a distant memory by the time the 2008 data are compiled. But imagine if they were paying at the top rate of 35%. That would roughly double their taxes paid in 2006, to $90 million each, or a total of roughly $36 billion. And that’s only 400 people

What a fair distribution of the *income* tax burden ought to be is subjective - I am certainly no communist who thinks that the tax burden ought to be borne exclusively by the wealthy, and think that the Obama plan (like the "fix" passed last month in Sacramento) represents if not socialism galloping at full speed, is at least of the creeping sort.

But let's get real here.

This argument obscures the truth in two ways. First, it focuses exclusively on income tax, ignoring sales, property, and other taxes that all essentially pay. Rich or poor, if you go to purchase a shirt, you pay the same sales tax. And second (and more important), the author focuses on income, not wealth. In this point, the top one per cent of earners are said to pay 25 per cent of all income taxes. Well, what share of the national wealth does this one per cent control?

Third, there is the argument that the wealthy are not, in fact, rich as they are portrayed. Mr Stewart opens with comments about resorts, private jets, and luxury condos, and ends up talking about people earning "six figures" and/or the theoretical target of the Obama "rich guy" tax ladder ($300,000 per annum in income).

The two (three) groups are not the same. A private jet of the sort that Steve Jobs flies around in is tens of millions of dollars. I would suggest that virtually no one earning $250,000 flies frequently in a private jet, or goes to the sort of resort that Jobs or Dick Fuld is able to frequent. To this point, there is a huge problem in homogenising "six figure" incomes - itself an enormous range of 100,000 to 999,9999 - someone earning $300,000, and multi-millionaires.

Mr Stewart again is using the fact that Americans simply do not understand the enormous gulf between 100,000, one million, and ten million as a blunt club.

He turns to a hypothetical individual with an annual income of $200,000, living in Manhattan:

In New York City, for example, $200,000 in income yields roughly $100,000 after all taxes (including the unincorporated business tax, which applies to anyone who’s self-employed). If you're following the prudent rule of thumb that you should spend no more than one-third of your after-tax income on housing, that means $33,000, or less than $3,000 a month, can go toward housing — barely enough for rent on a one-bedroom apartment in Manhattan. As for buying, the collapse in stock prices has wiped out much of what many people invested toward a down payment. New York may be atypically expensive, but many people who earn $200,000 and up have little choice but to live in a high-tax, high-cost location.

Now, it might be pointed out that the guy at $200,000 is, as of now, NOT going to be affected by the Obama tax rise, but that's somewhat akin to Titanic passengers complaining that their food was too cold.

What truly plagues this example are that, a) it is *not* the case that the person must live in Manhattan, and b) the 1/3 rule for after tax really does not scale up linearly.

For (a), the choice to live in Manhattan in the tiny one bedroom apartment is a choice. There is plenty of housing, along train lines, at much lower cost available in Brooklyn or Queens or Northern New Jersey. There are plenty of people who work at much lower salaries than $200,000 for whom Manhattan is simply not even a choice.

For (b), if one thinks about the application of the 1/3 rule for a second, the fallacy arises pretty quickly. Someone with an income of $75,000 who thus has an after-tax income of about $36,000 would have about $3,000 per month - $1000 for housing. THAT is a crunch, and leaves a total of 24,000 for all other expenses ($2000 per month) The guy in the example would similarly have 33,000 for housing, but $67,000 for other expenses, which is 5500 per month. I don't know about you, but 5 grand per month is a *lot* of money for discretionary spending. What he can buy with the difference in discretionary income over the person with the $75,000 income (more than three thousand dollars PER MONTH) is what makes him relatively "rich."

But more to the point, using this same model, someone who is right in the middle of the "six figure" income, $500,000, would pull down about $250,000 after taxes. If we apply the 1/3 rule to this, that's $83,000 for housing, or $6900 per month, leaving $167,000 for discretionary spend, or more than $13,000 per month. He has more than eleven thousand dollars every single month than the guy making $75k to spend on whatever he wants.

That's an awful lot of downloads from iTunes, isn't it?

To be fair to Mr Stewart, the person making $500,000 per year may not "feel rich," to be sure. But my guess is it's because he is looking from his apartment in Greenwich Village at people in his company who live on the upper East Side, or in Westchester County, and not the bridge and tunnel person who works for him.

So all things considered, the rhetorical question asked by Mr Stewart: "Considering taxes, who wants to be a millionaire," I suggest he look at the famous Pink Floyd song for an answer:

But if you ask for a rise, it's no surprise that they're giving none away.

There Is a Fine Line...

between clever, and stupid.

Anyone of roughly my chronological age and intellectual maturity will immediately recognise the quote of one David Saint Hubbins (of the fictitious, eponymous band Spinal Tap).

I was thinking of Mr Saint Hubbins two evenings ago as I watched the infomercial that was being masqueraded as a press conference by President Obama. Other than the embarrassingly inappropriate question about Alex Rodriguez, and the bumptious interruption about Joe Biden's latest brilliance - what, exactly, is the confidence interval around his 30 per cent point estimate for the probability of failure - the questions were largely not even softballs, which at the least are moving. The questions were rather more like balls teed up for a six year old. I am curious; who decided, for example, that the Huffington Post is part of the press in any real way, or that, aside from the voices in Patrick Leahy's head, who exactly is clamouring for a "Truth and Reconciliation" commission?

I voted for Mr Obama in November, but I have to say, he is off to a rough start. One of the reasons I did vote for him is that unlike his opponent, he at least had a veneer of change and ran on hope rather than fear. But I'll be damned if he did not sound a lot like George W Bush last night, even if only as a different libretto to the same score of fear and anxiety.

As for change, is there anyone left who honestly believes that things are going to be done differently by a cabinet with more re-treads that the 1989 Yankees? Looking over the cabinet (Hillary Clinton? Wasn't she born in the Watergate Hotel), I am reminded of the old English sit-com "Are You Being Served," which ran when I was much, much younger. There was an episode in which the Ladies department had to share with Gentleman's Ready-Mades during a renovation. After all the hilarity of Mrs Slocombe's bras atop Mr Grainger's trousers, the curtains were revealed to show.... that nothing had changed.

"It's just the same," Mrs Slocombe exclaimed.

Young Mr Grace responded that everything had been outfitted with new wood.

I would offer that the new administration is a lot like Grace Brothers.

The cabinet is in fact, all new wood.

But aside from that, Mrs Slocombe, green hair and all, would recognise that this administration and what it is sellling is just the same.

Don't Try This at Home

Another day, another incredible story. According to Reuters, the state of California is mulling refusing to release tax refunds to those who overpaid their taxes in 2008.

http://news.yahoo.com/s/nm/20090202/us_nm/us_usa_economy_california

Now, aside from the fact that this is basically theft, where does State Controller John Chiang get the chutzpah to tell people, whose money this actually is, that they must wait 30 days (or perhaps more) to get their money back?

What do you think the IRS, or in the case of Sacramento, the Franchise Tax Board, would say if, come 15th April, you said: "I know that I owe a few thousand dollars, but I am facing a 'cash shortfall,' and so I am going to hold back my taxes for 30 days?" For some reason, I think interest and penalties at the least would descend on you like the winged monkeys from "The Wizard of Oz."

California's fiscal irresponsibility apparently knows neither bounds nor shame. Some are saying the state is on the edge of a financial abyss. Could all those years of reckless spending finally be coming home to roost? Ah the joys of one-party rule.

Tax Cut Redux

One of today's headlines is discussing just what sort of "stimulus" is going to be coming from Washington; in this Whitman's Sampler of bad ideas lurks what some are calling "tax cuts," a great deal of which are in fact, not tax cuts at all, but tax credits and other goodies to try to coerce people into the behaviours that our Morlock Overseers want to engender in us.

Some months ago, I posted a comment on this blog

http://sjrefugee.blogspot.com/2008/11/brave-new-world-of-taxes.html

a question about what responsibilities one bears as a citizen of a country. I am reminded of the question today, as the folks in Washington debate just how to get us out of the mess we now find ourselves in due largely to our sloth, greed, and frankly, stupidity.

Put simply, what I see is more and more people being removed from the tax rolls, who, freed from the nuisance of having to pay for the "services" that they receive, will vote to expand their goodie bags at the increasing expense of the few of us who actually have to pay for them.

I once heard a quote that pretty aptly describes liberal compassion:

Compassion is A and B voting what they are going to force C to do to "help" D.

As you consider the so-called "stimulus package," ask yourself if you are a C or a D.

Quis Custodiet Ipsos Custodes?

If Christmas is the time of miracles, then surely, early January is the time of lists. This one landed in my mail box this morning:

• http://tinyurl.com/BestPlacestoWork

It's basically a back-of-the-envelope accounting of where the 50 "Best Places in America" to work are. Now, obviously this sample based on self-reported "satisfaction," carries with it all of the psychometric freight of that word as well as the inherent sampling bias. But setting that aside, a quick review of the list renders the following, most interesting top-line.

1. Eight of the 50 firms are in management consulting (e.g., McKinsey, Bain, Boston Consulting). That's almost 20 per cent of the field. Now, given that in the industry I work in, consultants are the modern day equivalent of the biblical publicans - not sure if Jesus Christ himself would sit and have a meal with them - this is strange. And if Scott Adams is to be believed, the view goes beyond just my immediate neighbourhood. I guess these 25 year olds are just good enough, smart enough, and dog gone it, people PAY them.
2. 10 of the 50 (20%) firms are new-styled tech (apps, software, services) companies - companies like Google, salesforce-dot-com, Citrix. I guess that there must be something to be said for loving what you do, since these guys are spending the lion's share of there time at the office working and playing ping-pong with their colleagues rather than at home with their families.
3. There are several banks (Goldman Sachs is 26th). If this report were adjusted using linearly-weighted moving averages or some other tool for adjusting for the time component and hence implosion of Wall St, what would the outcome be?
4. General Mills tops the list. No wonder Jerry Seinfeld always has a box or bowl of cereal in view in every episode of his show. After all, maybe they really are magically delicious.

Enjoy 2009!