Archive for the ‘news’ Category

The cost savings of food stamps cuts versus the cost increases of diabetes care

As many of you are aware, food stamps were recently cut in this country. This has had a brutal effect on people and families and on neighborhood food pantries, which are being swamped with new customers and increased need among their existing customers.

One thing that I come away with when I read articles describing this problem is how often they detail individuals who have been diagnosed with diabetes but can no longer afford to pay for appropriate food for their condition.

As a person with a family history of diabetes, and someone who has been actively avoiding sugars and carbs to control my blood sugar for the past couple of years, I have a tremendous amount of sympathy for these struggling people.

Let me put it another way. Eating well in this country is expensive, and I’ve had to spend real money on food here in New York City to avoid sugary and fast carb-laden food. I don’t think I could have done that on a skimpy food budget. It’s especially hard to imagine budgeting healthy food on a withering food stamp budget.

Because here’s the thing, and it’s not a secret: shitty food is cheap. If I need to buy lots of food (read: calories) for a small amount of money, I can do it easily, but it will be hell for my blood sugar control. I’m guessing I’d be a full-blown diabetic by now if I were poor and on food stamps.

And that brings me to my nerd question of the morning. How much money are we really saving by decreasing the food stamp allowance in this country, if we consider how many more people will be diagnosed diabetic as a result of the decreased quality of their diet? And how many people’s diabetes will get worse, and how much will that cost?

It’s not over, either: apparently more cuts are coming over the next 10 years (maybe by $4 billion, maybe by $40 billion). And although diabetes care costs have gone up 40% in the last 5 years ($245 billion in 2012 from $174 billion in 2007), that doesn’t mean they won’t go up way more in the next 10.

I’m not an expert on how this all works, but the scale is right – we’re talking billions of dollars nationally, so not small potatoes, and of course we’re also talking about people’s quality of life. Never mind in a moral context – I’m definitely of the mind that people should be able to eat – I’m wondering if the food stamp cuts make sense in a dollars and cents context.

Please tell me if you know of an analysis in this direction.

Categories: modeling, news

#AskJPM and public shaming #OWS

I don’t usually shill for companies but this morning I’m completely into how much of a circus my Twitter feed became yesterday when JP Morgan Chase’s PR team decided to open up to the public for questions. You can see from the immediate replies how this was going to go:

Screen Shot 2013-11-14 at 6.49.22 AM

The questions asked which were tagged with #AskJPM are stunning and constitute a well-deserved public shaming of JP Morgan.

My friend and co-occupier Alexis Goldstein was absolutely killing it on Twitter, as usual. Here’s just a snippet from her feed:

Screen Shot 2013-11-14 at 6.52.57 AM

See also Dave Dayen’s choice question:

Screen Shot 2013-11-14 at 6.54.38 AM

Needless to say the Q&A was canceled, but not until the #AskJPM hashtag went viral in an amazing way. See more examples here and here.

Update: Watch #AskJPM tweets read by Stacy Keach live on CNBC!!

Categories: #OWS, finance, news

You are not a loan: Rolling Jubilee eradicates $15,000,000 worth of debt #OWS

This is super cool. Occupy Wall Street’s Strike Debt group has bought up almost $15 million dollars worth of mostly medical debt which was owned by 2,700 people across 45 states and Puerto Rico. They used donations they’ve been collecting over the last year. There’s more information about this action in this Guardian piece.

Here’s what I like about this. By freeing people of medical debt in particular, which is the biggest cause of bankruptcy filings, it emphasizes the lie of the “moral sin” often associated with crushing debt.

In other words, instead of imagining poor and debt-ridden people as lazy and glibly unable to keep their promises, the Rolling Jubilee action bestows a much-needed act of compassion for some of the millions of the unlucky people in this country caught in a dysfunctional health and credit system.

And while it’s true that it is making a small dent in the debt problem, in dollars and cents terms, I think the Strike Debt’s debt action, and its Debt Resistors’ Operation Manual, has made huge strides in how people think about debt in this country, which is tremendously important.


Categories: #OWS, finance, news

Yves Smith and Dean Baker discuss the Trans Pacific Partnership #OWS

Last night I watched this interview by Yves Smith and Dean Baker on I recommend it for everyone interested in learning about the secret “free trade” agreement currently under negotiation between the U.S. and a bunch of other countries which touch the Pacific Ocean.

The interview will explain why “free trade” is in quotes, because it’s really more about protecting corporate interests and extending patents than about reducing obstacles to trade:

As a member of Alt Banking, I’m particularly outraged by the financial regulation part of the treaty, which sound like a race to the bottom in terms of common laws between the countries. But probably the worst part of the treaty is related to pharmaceutical protectionism.

Near the end of the interview there’s an appeal, involving a monetary award, for people on the inside to come out and show the world exactly what the contents of the treaty contain. The award is sponsored by WikiLeaks and is crowdsourced: it currently stands at $61,252. So you can add to it if you want to sweeten the pot.

Categories: #OWS, finance, news

Are PayDay lenders better than banks? #OWS

Sometimes my plan of getting up super early to write on my blog fails, and this is one of those days. But I’m still going to ask you to read this article from the New Yorker written by Lisa Servon and entitled, “The High Cost, For The Poor, Of Using A Bank.” Here’s a key passage, but the whole thing is amazing, and yes, I’ve invited her to my Occupy group already:

To understand why, consider loans of small amounts. People criticize payday loans for their high annual percentage rates (APR), which range from three hundred per cent to six hundred per cent. Payday lenders argue that APR is the wrong measure: the loans, they say, are designed to be repaid in as little as two weeks. Consumer advocates counter that borrowers typically take out nine of these loans each year, and end up indebted for more than half of each year.

But what alternative do low-income borrowers have? Banks have retreated from small-dollar credit, and many payday borrowers do not qualify anyway. It happens that banks offer a de-facto short-term, high-interest loan. It’s called an overdraft fee. An overdraft is essentially a short-term loan, and if it had a repayment period of seven days, the APR for a typical incident would be over five thousand per cent.

It makes me wonder whether, if someone did a careful analysis with all-in costs including time and travel, whether PayDay Lenders are not actually a totally rational choice for the poor.

Categories: #OWS, finance, modeling, news

Make Rich People Read Chekhov

There have been two articles in the New York Times very recently concerning empathy.

First, there was this Opinionator piece about how rich people have less empathy. Second, there was this Well blogpost which reports on a study that implies you can improve your empathy skills, at least in the short term, by reading literary fiction like Chekhov.

Empathy means understanding and sharing the feelings of other people. So what do these two columns actually refer to?

For rich people, it’s mostly about attention rather than empathy. The idea is that researchers study how people pay attention to people (answer: they pay attention to high status people more), and found that rich people don’t do it much at all. They claim attention is a prerequisite for empathy, and that there’s a negative feedback loop going on with the rich, a lack of empathy, and increasing inequality.

As for the literary fiction column, it cites a study in which what they measure is something a little bit different, namely the “theory of mind” of a person after reading Checkhov versus something else. The concept of the theory of mind is that we have internal models of other people’s mindset, and actually they claim to be able to separate this into two parts, cognitive and affective. So if I have a realistic impression of what you’re feeling, we say that my affective theory of mind is good, whereas if I have a realistic impression of how you’re planning to act, that’s called nailing a cognitive theory of mind.

A few comments:

  1. I’m not so sure about the attention-leads-to-empathy assumption. Sometimes I am on a subway and I start sensing people’s emotions around me whether I like it or not, even when I’m trying not to pay attention to them. For me empathy is like smell, and some people are incredibly smelly, especially on the subway.
  2. On the other hand it resonates with me that rich people have less empathy. Certainly this seemed to be the case when I worked at D.E. Shaw, although it might have been a self-selection thing: maybe people who are not empathetic are attracted to working at a hedge fund.
  3. In any case, there’s a tremendous disconnect between regular people and the attitude of finance people, along the lines of “I’m smarter than those people so I deserve to be rich”, and I ascribe much of this disconnect to a lack of empathy.
  4. In both of these columns, though, the question was how well do you pay attention to, and read, people in the same room with you. Unfortunately that’s not a good enough question, at least if you’re worried about that negative feedback loop, if you think about the real world. In the real world, even in New York, rich people don’t spend lots of time in the same room with anyone except other rich people. So it’s a bigger problem to address than what you might at first think.
  5. Having said that, I don’t claim that if everyone just had more empathy all our problems would be solved. Even so I do think it might help. Certainly my sensitivity to other people’s emotions deeply affects me and my actions and goals, but of course that’s too little evidence to go by.
  6. In any case it’s an interesting thought experiment to imagine a world of increased empathy. I like that it’s being considered as a basic attribute of interest, and that it seems tweakable.
  7. Conclusion: before talking to someone I perceive as unempathetic, I will bust out a Checkov short story (this one) and demand they read it on the spot. That should really help.
Categories: finance, musing, news

Inside the GOP, a report from Democracy Corps

I was wondering what a lot of other people were wondering yesterday. Namely why, if Republicans were claiming their party was being hijacked by a small minority of Tea Party lunatics, did they actually have a majority vote for closing down the government? It’s a statistical conundrum.

A fascinating report entitled Inside the GOP: Report on focus groups with Evangelical, Tea Party, and moderate Republicans explains that to me. It was put out by Democracy Corps, a non-profit Democratic strategy think tank co-founded by Stan Greenberg, and it explains the current mindset of different factions of the Republican Party, inferred from focus groups made up of three types of Republicans: Evangelicals (55%), moderates (25%), and Tea Partiers (20%).

You should read the whole thing, because it’s absolutely fascinating, but I think the explanation of the above-mentioned statistical conundrum is as follows: Tea Partiers are minority, but the largest group, namely the Evangelicals (think Fox News, anti-gay marriage) are behind the Tea Party’s agenda on the Affordable Care Act as well as Obamacare, and together they represent the majority of the Republican Party. Maybe you knew this but I didn’t.

Other things this report brings up:

  • how deeply race matters to Evangelicals, especially when it comes to Obamacare,
  • how tenuous the alliance is between Tea Party Republicans and Evangelicals, considering Tea Partiers don’t care about social issues like gay marriage and Evangelicals deeply care, and
  • just how much Fox News matters in this world.
Categories: news

Sunday morning reading

September 29, 2013 3 comments

I wanted to share with you guys a few things I’ve been interested in this weekend.

First, this TED talk which for whatever reason never made it onto the TED main website. It’s by Nick Hanauer, and in it he dispels some common economic myths, much like Chapter 7 of Occupy Finance. A juicy quote: “So when businesspeople take credit for creating jobs, it’s a little like squirrels taking credit for creating evolution. In fact, it’s the other way around.”

Next, it turns out women are way better than men at orgasms, at least those where you do it all in your head – a “think off”. A full 2% of women can fantasize their way to climax (compared to, I guess, way fewer men) and there’s even training for this skill. Two questions from the mathbabe. First, do wet dreams count? Because if they do I think we’ll have to recount. Second, say I invest my time in this, and get really good at it, since it’s all hands-free and such and will make my life that much more efficient. Is this something that takes a lot of time? Can I do it whilst carrying groceries home, or whilst cooking dinner? On the subway? Between stops? Details please.onetrain

Next, here’s an important discussion of why junior people get criminally prosecuted – in this case, for the debacle that was the JP Morgan London Whale case – while the big bosses just get vaguely complained about in a civil case, and the shareholders end up paying huge fines for their misbehavior. Last two lines: “Yet it remains disquieting when the same actions result in criminal charges for some but only a civil case for others, and no individuals are held responsible for misconduct at a company. In the end, we are left to trust that prosecutors have made good decisions.” There’s no recourse for bad prosecuting either. How do we even protest bad prosecuting?

Next, I’ve been listening to some seriously catchy and funny tunes my boys turned me on to. What makes me old is how long it takes me to catch on to stuff, since I heard this one years ago, but it seems that everything that these guys touch is hilarious. Especially this one (also see “I Just Had Sex” and “Jack Sparrow“):

Finally, I’m really into knitting recently, and I recently figured out how to knit this pattern even though you’d have to pay big bucks to get the official pattern. Email me if you’re interested in the bootleg version.

Not mine - I stole this picture. I am still working on mine.

Not mine – I stole this picture. I am still working on mine.

Categories: musing, news

A Code of Conduct for data scientists from the Bellagio Fellows

September 25, 2013 3 comments

The 2013 PopTech & Rockefeller Foundation Bellagio Fellows – Kate CrawfordPatrick MeierClaudia PerlichAmy LuersGustavo Faleiros and Jer Thorp – yesterday published “Seven Principles for Big Data and Resilience Projects” on Patrick Meier’s blog iRevolution.

Although they claim that these principles are meant for “best practices for resilience building projects that leverage Big Data and Advanced Computing,” I think they’re more general than that (although I’m not sure exactly what a resilience building project is) I and I really like them. They are looking for public comments too. Go to the post for the full description of each, but here is a summary:

1. Open Source Data Tools

Wherever possible, data analytics and manipulation tools should be open source, architecture independent and broadly prevalent (R, python, etc.).

2. Transparent Data Infrastructure

Infrastructure for data collection and storage should operate based on transparent standards to maximize the number of users that can interact with the infrastructure.

3. Develop and Maintain Local Skills

Make “Data Literacy” more widespread. Leverage local data labor and build on existing skills.

4. Local Data Ownership

Use Creative Commons and licenses that state that data is not to be used for commercial purposes.

5. Ethical Data Sharing

Adopt existing data sharing protocols like the ICRC’s (2013). Permission for sharing is essential. How the data will be used should be clearly articulated. An opt in approach should be the preference wherever possible, and the ability for individuals to remove themselves from a data set after it has been collected must always be an option.

6. Right Not To Be Sensed

Local communities have a right not to be sensed. Large scale city sensing projects must have a clear framework for how people are able to be involved or choose not to participate.

7. Learning from Mistakes

Big Data and Resilience projects need to be open to face, report, and discuss failures.

Are you cliterate?

September 24, 2013 1 comment

Not much time this morning for blogging, but I wanted everyone to get a chance to read this amazing Huffington Post article about learning more than you ever thought possible about the female sexual organ, and then celebrating that knowledge in style.

The article is actually more inspiring than you’d think, and I found myself weeping with joy at times. I’m an easy cry, but still.

Plus, any article that has this picture is worth reading:


Categories: musing, news

Happy Birthday, Occupy Wall Street! #OWS

September 17, 2013 17 comments

Hey, what are you doing for the 2nd anniversary of the occupation of Zuccotti Park?

I know what I’m doing, namely going down to the park and handing out hundreds of copies of my occupy group’s new book – now on scribd!!. Here’s a ridiculous gif of the pile of books that came from the printer yesterday with my kindergartner posing by it (you might need to click on it to see the animation!!):

Someone isn't shy.

Someone isn’t shy.

I’m also planning a small speech at 10:15am, which I’m still writing. I’ll post it here later. here it is:

Thank you for coming
Thank you for occupying
I am here today to announce a birth
The birth of a book
It’s called “Occupy Finance”
We wrote it
we are Alternative Banking

Who are we?
We are a working group of Occupy
we first met almost two years ago
we have been meeting ever since
we meet every Sunday afternoon
at Columbia University
our meetings are totally open
we want you to come

We discuss the financial system
we discuss financial regulation
we discuss how lobbyists destroy regulation
we discuss how Obama destroys regulation
we discuss what we can do to help
how we can make our opinions known
how we can make the system work for us
the 99%

Last year we had a project
The 52 Shades of Greed
we came here to Zuccotti Park
we gave out hundreds of packs of cards
they explained the financial system
they called out the criminals
they called out the toxic ideas
and the toxic instruments
and the toxic institutions
that started this mess

This year we’ve come back
with another present to share
it’s a book we wrote
it’s a book for all of us
it explains how the financial system works
and how it doesn’t work
it explains how the system uses us
how the bankers scam us all
how the regulators fail to do their job
how the politicians have been bought

Why did we write this book?
we wrote it for you
and we wrote it for us
we wrote it for anyone
who wants to know
how to argue against
the side of greed
the side of corruption
the side of entitlement

let me tell you something
some people call us radicals
but listen up
when the top 1%
capture 95% of the income gains
since the so-called end
of the recession,
when more than half the country thinks
that we didn’t do enough
to put bankers in jail,
when the median household income
has gone down 7.3% since 2007,
when the actual employment rate
is 5% below 2007,
when the jobs that do exist are crappy
when we get paid with prepaid debit cards
that nickel and dime us all
then what we demand is not radical
it is only a system that works
we are asking for a just system
we are asking for a fair system
we are asking for an end to too-big-to-fail
we demand banks take less risk
with our money
and we are asking lawmakers
to stop banks
once and for all
from scamming people because they are poor

Please join us
we want you to come
you don’t need to be an expert
we started out as strangers
who wanted to know how things work
we have become friends
we have become allies
we have made something
out of our curiousity
and out of our hard work
and we are here today
to share that with you
and to ask you to join us
please join us
happy birthday to us!
Thank you!!

Categories: #OWS, finance, news

Sunday morning musing: is sexism an addiction?

I’ve been reading articles about cultures of sexism at Harvard Business School and in philosophy, both articles published in the New York Times this past week. The two of them have gotten me to speculate about the different ways that men and women experience sexist behavior.

Namely, very differently. Women, being the targets of sexist remarks and behavior, are sensitive to its barbaric nature and status-oriented putdowns – they are aware of it because it so obviously stings. Men – some men, not all – consistently seem baffled by all the fuss, and if they acknowledge the behavior, it is, in their opinion, more like having fun than being mean.

“Why would people want me to stop having fun?” they ask.

It makes me wonder if sexism is addictive. Let me explain my Sunday morning theory.

Assume that, when men perform an act of sexism, they get rewarded in their pleasure center similar to when someone takes a street drug or has sex.

So for example, say some male Harvard Business School (HBS) student encounters a female HBS colleague who is a potential competitor. To establish his dominance, he puts her down publicly on the basis of her looks. As mentioned in the article, the HBS population is obsessed with status, and this is a standard way of keeping her status low and simultaneously making her anxious and distracted.

My question is, what happens inside that man’s brain when he does that? For that matter, what happens to the brains of the other men in that group who witness that? My theory is that they all experience a kind of pleasure center stimulation, whereby their entire group is nudged up in rank over some “other,” which happens to be that woman. In some sense it’s kind of irrelevant who they put down in order to be rewarded, though, which is why they don’t think of what they did as a bad thing, just something that they vaguely enjoyed.

Go back to how differently the men and women describe their experiences after the fact of sexist environments. Men consistently don’t remember it as a negative event. From the article about sexism in philosophy:

I’m always hearing from stressed-out men, worrying aloud what “all this fuss” about sexual harassment means for them. I’ve heard it at training sessions on university sexual harassment policy: “Does this mean I can’t even tell a woman that she looks nice?” I’ve heard it in coffee lounges: “Make sure you keep your door open when you’re talking to a woman student — you never know what she might say later.” And I’ve had it confided to me, with a sigh of regret, at conference happy hours: “I’m afraid now to form any relationships with female students — they might take it the wrong way.”

I don’t think men are lying. I think they actually experience sexist events as positive and benign.

It also makes sense how men react when sexism is addressed by the higher authorities in the form of sensitivity training. When men are forced into a room to talk about sexism and norms of appropriate behavior, they’re super uncomfortable and don’t seem to know why they’re there (again, not all men). They for whatever reason don’t think discussions about sexism apply to them, like it’s a women’s issue.

On the other hand, as we saw in the HBS article, forcing men to talk about it at length does seem to actually help, in spite of their protests. The article focuses on women’s behavior, I think overly much, but it’s just as much about men as it is about women. True, women undermine themselves by competing with each other to be perfect and sexy and brilliant (but not too brilliant), etc., but really it’s about getting them men to stop with their nonsense, right?

And what might be happening is that, along with the positive feedback which stimulates the pleasure center, through this training they might also be developing a second, negative feedback around sexist comments, which would mean that eventually, if that second feedback grew strong enough, it would no longer feel so good to be sexist.

I mean, how do you break someone of their addictive habits? I guess you could destroy the pleasure center altogether, but that seems extreme except for the really most annoying HBS folks. Probably what you’d want to do is counteract the effect with an opposing effect. Thus sensitivity training.

Of course, this theory applies equally well to other forms of discrimination. And it’s not obvious how to address it even if it’s true. But at least, if we thought about it this way, it would throw light on the baffling disconnect whereby such problems are glaringly obvious to some while remaining utterly invisible to others.

Categories: musing, news

Simons Center for Data Analysis

Has anyone heard of the new Simons Center for Data Analysis?

Neither had I until just now. But some guy named Leslie Greengard, who is a distinguished mathematician and computer scientist, just got named its director (hat tip Peter Woit).

Please inform me if you know more about this center. I got nothing except this tiny description:

As SCDA’s director, Greengard will build and lead a team of scientists committed to analyzing large-scale, rich data sets and to developing innovative mathematical methods to examine such data.

Categories: data science, news

Short your kids, go long your neighbor: betting on people is coming soon

Yet another aspect of Gary Shteyngart’s dystopian fiction novel Super Sad True Love Story is coming true for reals this week.

Besides anticipating Occupy Wall Street, as well as Bloomberg’s sweep of Zuccotti Park (although getting it wrong on how utterly successful such sweeping would be), Shteyngart proposed the idea of instant, real-time and broadcast credit ratings.

Anyone walking around the streets of New York, as they’d pass a certain type of telephone pole – the kind that identifies you via your cell phone and communicates with data warehousing services and databases – would have their credit rating flashed onto a screen. If you went to a party, depending on how you impressed the other party go-ers, your score could plummet or rise in real time, and everyone would be able to keep track and treat you accordingly.

I mean, there were other things about the novel too, but as a data person these details certainly stuck with me since they are both extremely gross and utterly plausible.

And why do I say they are coming true now? I base my claim on two news stories I’ve been sent by my various blog readers recently.

[Aside: if you read my blog and find an awesome article that you want to send me, by all means do! My email address is available on my "About" page.]

First, coming via Suresh and Marcos, we learn that data broker Acxiom is letting people see their warehoused data. A few caveats, bien sûr:

  1. You get to see your own profile, here, starting in 2 days, but only your own.
  2. And actually, you only get to see some of your data. So they won’t tell you if you’re a suspected gambling addict, for example. It’s a curated view, and they want your help curating it more. You know, for your own good.
  3. And they’re doing it so that people have clarity on their business.
  4. Haha! Just kidding. They’re doing it because they’re trying to avoid regulations and they feel like this gesture of transparency might make people less suspicious of them.
  5. And they’re counting on people’s laziness. They’re allowing people to opt out, but of course the people who should opt out would likely never even know about that possibility.
  6. Just keep in mind that, as an individual, you won’t know what they really think they know about you, but as a corporation you can buy complete information about anyone who hasn’t opted out.

In any case those credit scores that Shteyngart talks about are already happening. The only issue is who gets flashed those numbers and when. Instead of the answers being “anyone walking down the street” and “when you walk by a pole” it’s “any corporation on the interweb” and “whenever you browse”.

After all, why would they give something away for free? Where’s the profit in showing the credit scores of anyone to everyone? Hmmmm….

That brings me to my second news story of the morning coming to me via Constantine, namely this TechCrunch story which explains how a startup called Fantex is planning to allow individuals to invest in celebrity athletes’ stocks. Yes, you too can own a tiny little piece of someone famous, for a price. From the article:

People can then buy shares of that player’s brand, like a stock, in the Fantex-consumer market. Presumably, if San Francisco 49ers tight end Vernon Davis has a monster year and looks like he’s going to get a bigger endorsement deal or a larger contract in a few years, his stock would rise and a fan could sell their Davis stock and cash out with a real, monetary profit. People would own tracking or targeted stocks in Fantex that would depend on the specific brand that they choose; these stocks would then rise and fall based on their own performance, not on the overall performance of Fantex.

Let’s put these two things together. I think it’s not too much of a stretch to acknowledge a reason for everyone to know everyone else’s credit score! Namely, we can can bet on each other’s futures!

I can’t think of any set-up more exhilarating to the community of hedge fund assholes than a huge, new open market – containing profit potentials for every single citizen of earth – where you get to make money when someone goes to the wrong college, or when someone enters into an unfortunate marriage and needs a divorce, or when someone gets predictably sick. An orgy in the exact center of tech and finance.

Are you with me peoples?!

I don’t know what your Labor Day plans are, but I’m getting ready my list of people to short in this spanking new market.

College ranking models

Last week Obama began to making threats regarding a new college ranking system and its connection to federal funding. Here’s an excerpt of what he was talking about, from this WSJ article:

The president called for rating colleges before the 2015 school year on measures such as affordability and graduation rates—”metrics like how much debt does the average student leave with, how easy is it to pay off, how many students graduate on time, how well do those graduates do in the workforce,” Mr. Obama told a crowd at the University at Buffalo, the first stop on a two-day bus tour.

Interesting! This means that Obama is wading directly into the field of modeling. He’s probably sick of the standard college ranking system, put out by US News & World Reports. I kind of don’t blame him, since that model is flawed and largely gamed. In fact, I made a case for open sourcing that model recently just so that people would look into it and lose faith in its magical properties.

So I’m with Obama, that model sucks, and it’s high time there are other competing models so that people have more than one thing to think about.

On the other hand, what Obama is focusing on seems narrow. Here’s what he supposedly wants to do with that model (again from the WSJ article):

Once a rating system is in place, Mr. Obama will ask Congress to allocate federal financial aid based on the scores by 2018. Students at top-performing colleges could receive larger federal grants and more affordable student loans. “It is time to stop subsidizing schools that are not producing good results,” he said.

His main goal seems to be “to make college more affordable”.

I’d like to make a few comments on this overall plan. The short version is that he’s suggesting something that will have strong, mostly negative effects, and that won’t solve his problem of college affordability.

Why strong negative effects?

What Obama seems to realize about the existing model is that it’s had side effects because of the way college administrators have gamed the model. Presumably, given that this new proposed model will be directly tied to federal funding, it will be high-impact and will thus be thoroughly gamed by administrators as well.

The first complaint, then, is that Obama didn’t address this inevitably gaming directly – and that doesn’t bode well about his ability to put into place a reasonable model.

But let’s not follow his lead. Let’s think about what kind of gaming will occur once such a model is in place. It’s not pretty.

Here are the attributes he’s planning to use for colleges. I’ve substituted reasonably numerical proxies for his descriptions above:

  1. Cost (less is better)
  2. Percentage of people able to pay off their loans within 10 years (more is better)
  3. Graduation rate (more is better)
  4. Percentage of people graduating within 4 years (more is better)
  5. Percentage of people who get high-paying jobs after graduating (more is better)


Nobody is going to argue against optimizing for lower cost. Unfortunately, what with the cultural assumption of the need for a college education, combined with the ignorance and naive optimism of young people, not to mention start-ups like Upstart that allow young people to enter indentured servitude, the pressure is upwards, not downwards.

The supply of money for college is large and growing, and the answer to rising tuition costs is not to supply more money. Colleges have already responded to the existence of federal loans, for example, by raising tuition in the amount of the loan. Ironically, much of the rise in tuition cost has gone to administrators, whose job it is to game the system for more money.

Which is to say, you can penalize certain colleges for being at the front of the pack in terms of price, but if the overall cost is rising constantly, you’re not doing much.

If you really wanted to make costs low, then fund state universities and make them really good, and make them basically free. That would actually make private colleges try to compete on cost.

Paying off loans quickly

Here’s where we get to the heart of the problem with Obama’s plan.

What are you going to do, as an administrator tasked with making sure you never lose federal funding under the new regime?

Are you going to give all the students fairer terms on their debt? Or are you going to select for students that are more likely to get finance jobs? I’m guessing the latter.

So much for liberal arts educations. So much for learning about art, philosophy, or for that matter anything that isn’t an easy entrance into the tech or finance sector. Only colleges that don’t care a whit about federal money will even have an art history department.

Graduation rate

Gaming the graduation rate is easy. Just lower your standards for degrees, duh.

How quickly people graduate

Again, a general lowering of standards is quick and easy.

How well graduates do in the workforce

Putting this into your model is toxic, and measures a given field directly in terms of market forces. Economics, Computer Science, and Business majors will be the kings of the hill. We might as well never produce writers, thinkers, or anything else creative again.

Note this pressure already exists today: many of our college presidents are becoming more and more corporate minded and less interested in education itself, mostly as a means to feed their endowments. As an example, I don’t need to look further than across my street to Barnard, where president Debora Spar somehow decided to celebrate Ina Drew as an example of success in front of a bunch of young Barnard students. I can’t help but think that was related to a hoped-for gift.

Obama needs to think this one through. Do we really want to build the college system in this country in the image of Wall Street and Silicon Valley? Do we want to intentionally skew the balance towards those industries even further?

Building a better college ranking model

The problem is that it’s actually really hard to model quality of education. The mathematical models that already exist and are being proposed are just pathetically bad at it, partly because college, ultimately, isn’t only about the facts you learn, or the job you get, or how quickly you get it. It’s actually a life experience which, in the best of cases, enlarges your world view, and gets you to strive for something you might not have known existed before going.

I’d suggest that, instead of building a new ranking system, we on the one hand identify truly fraudulent colleges (which really do exist) and on the other, invest heavily in state schools, giving them enough security so they can do without their army of expensive administrators.

Categories: modeling, news, rant

How to be a pickup artist, Silicon Valley style

You know that feeling you get when you’re reading an disembodied article on the web and it’s just so ridiculous, you get the creeping sensation that it’s either from The Onion or the Borowitz Report?

That is, I would suggest, how you’re going to feel when you read this article about a school for Silicon Valley style entrepreneurship (hat tip Peter Woit). Even just the name of the school – the Draper University of Heroes – feels like an Onion article, never mind the visuals:

Students in class at the Draper University of Heroes

Students in class at the Draper University of Heroes

So, what do these young people learn do to become douchebag heros? Here’s what:

  • They pledge allegiance every morning to their personal brands,
  • They submit to a full two days of coding and excel lessons,
  • Then they get down to the real work of sun tanning by the pool and go-kart racing,
  • They hang out with VC Tim Draper, an investor in Tesla (the new conspicuous consumption choice among pseudo-progressive capitalists, as I learned at FOO),
  • They read books, or at least they own books, including Donald Trump’s The Art of the Deal, The Wall Street MBA, and Ayn Rand’s The Fountainhead,
  • and all this for just $9,500 for an eight week program!

How does it end? From the article:

In lieu of diplomas, Draper U. students receive masks and capes printed with their superhero nicknames and are instructed to jump on each of a series of three small trampolines placed in a line in front of them. While bouncing from trampoline to trampoline, they’re told to shout, “Up, up, and away!” Then they assemble for a group photo.

“The world needs more heroes,” Draper says. “And it just got 40 more of them!”

Here’s the thing. It’s no accident that there are way more men than women here. This school is very similar in design and intent to the society built by Neil Strauss, who wrote The Game and taught a bunch of guys how to pick up “hot” women for sex – Aunt Pythia discussed it here.

Why do I say that? Because it’s fundamentally a confidence-boosting ritual, where a bunch of guys convince themselves that their prospects are good, their goals are attainable, their narcissistic world view is honorable, and it’s just a question of acquiring the right magic tricks to entrap their prey. It just happens to be about money instead of sex in this case.

There is a difference, of course. Whereas the pick up artists only needed to trick drunk women for a few hours in order to sleep with them, these “Silicon Valley Heroes” have to trick way more people for way longer that they should get investment. That doesn’t make it impossible for something like this to work, though, just harder.

Categories: musing, news

Minorities possible unfairly disqualified from opening bank accounts

My friend Frank Pasquale sent me this article over twitter, about New York State attorney general Eric T. Schneiderman’s investigation into possibly unfair practices by big banks using opaque and sometimes erroneous databases to disqualify people from opening accounts.

Not much hard information is given in the article but we know that negative reports stemming from the databases have effectively banished more than a million lower-income Americans from the financial system, and we know that the number of “underbanked” people in this country has grown by 10% since 2009. Underbanked people are people who are shut out of the normal banking system and have to rely on the underbelly system including check cashing stores and payday lenders.

I can already hear the argument of my libertarian friends: if I’m a bank, and I have reason to suspect you have messed up with your finances in the past, I don’t offer you services. Done and done. Oh, and if I’m a smart bank that figures out some of these so-called “past mistakes” are actually erroneously reported, then I make extra money by serving those customers that are actually good when they look bad. And the free market works.

Two responses to this. First, at this point big banks are really not private companies, being on the taxpayer dole. In response they should reasonably be expected to provide banking services to all of not most people as part of a service. Of course this is a temporary argument, since nobody actually likes the fact that the banks aren’t truly private companies.

The second, more interesting point – at least to me – is this. We care about and defend ourselves from our constitutional rights being taken away but we have much less energy to defend ourselves against good things not happening to us.

In other words, it’s not written into the constitution that we all deserve a good checking account, nor a good college education, nor good terms on a mortgage, and so on. Even so, in a large society such as ours, such things are basic ingredients for a comfortable existence. Yet these services are rare if not nonexistent for a huge and swelling part of our society, resulting in a degradation of opportunity for the poor.

The overall effect is heinous, and at some point does seem to rise to the level of a constitutional right to opportunity, but I’m no lawyer.

In other words, instead of only worrying about the truly bad things that might happen to our vulnerable citizens, I personally spend just as much time worrying about the good things that might not happen to our vulnerable citizens, because from my perspective lots of good things not happening add up to bad things happening: they all narrow future options.

Categories: modeling, news, rant

Larry Summers being set up to fail?

I’m back from PyData, which was a lot of fun and filled with super nice nerdy people. My prezi slides are now available here.

I have time for one thought: a bunch of people have chatted me up recently with the theory that Larry Summers is being put in the running for the Fed Chair alongside Janet Yellen just so that, when Yellen gets the call, we can all breathe a sigh of relief it didn’t go to Summers.

In other words, it’s a wholly political ploy so the Obama can look like a hero for women everywhere when he chooses Yellen, and so that we can all conclude that at least Obama’s learned this one lesson with regards to dealing with the ongoing financial crisis: Summers isn’t the solution.

Depending on my mood I sometimes buy into this theory, but obviously I’m still worried.

Categories: finance, news

PyData and a few other things

So here’s the thing about being a parent of benign neglect: it’s no walk in the park. I talk a big game, but the truth is I’ve have trouble getting to sleep from the anxiety. To distract myself I’ve been watching Law & Order episodes on Netflix until the wee hours of the night.

Two things about this plan suck. First, my husband is in Amsterdam, which means he’s 6 time zones away from our oldest son whereas I’m only 3, but somehow that means I’m shouldering 99.5% of the responsibility to worry (there’s some universal geographic law of parenting at work there but I don’t know how to formulate it). Second, half of the L&O episodes involve either children getting maimed or killed or child killers. Not restful but I freaking can’t stop!

In any case, not much extra energy to spring out of bed and write the blog, so apologies for a sparse period for mathbabe. For whatever reason I woke up this morning in time to blog, however, so as to not miss an opportunity it’s gonna be in list form:

  1. I’ve been invited to keynote at PyData in Cambridge, MA at the end of the month – me and Travis Oliphant! I’m still coming up with the title and abstract for my talk, but it’s going to be something about storytelling with data using the iPython Notebook. Please make suggestions!
  2. I was in a Wall Street Journal article about Larry Summers, talking about whether he’s got a good personality to take over from Ben Bernanke, i.e. should we trust our lives and our future with him. I say nope. What’s funny is that my uncle, economist Bob Hall, is also referred to in the same article. The journalist didn’t know we’re related until after the article came out and Uncle Bob informed him.
  3. Hey, can we give it up for Eliot Spitzer? The powers that be are down about that guy presumably for having sex with prostitutes but really because he’s a threat. I say legalize prostitution, unionize the prostitutes a la the dutch, and put Spitzer in charge of something involving money and corruption, he’s smart and fearless. Who’s with me?
  4. It looks like good news: the Consumer Financial Protection Bureau might be cracking down on illegal debt collector tactics. Update: wait, the fines are fractions of 1% of the revenue these guys made on their unfair practices. Can we please have a rule that when you get caught breaking the law, the fine will be large enough so it’s no longer profitable?
Categories: news, open source tools

How much would you pay to be my friend?

I am on my way to D.C. for a health analytics conference, where I hope to learn the state of the art for health data and modeling. So stay tuned for updates on that.

In the meantime, ponder this concept (hat tip Matt Stoller, who describes it as ‘neoliberal prostitution’). It’s a dating website called “What’s Your Price?” where suitors bid for dates.

Screen Shot 2013-06-03 at 7.19.56 AM


What’s creepier, the sex-for-pay aspect of this, or the it’s-possibly-not-about-sex-it’s-about-dating aspect? I’m gonna go with the latter, personally, since it’s a new idea for me. What else can I monetize that I’ve been giving away too long for free?

Hey, kid, you want a bedtime story? It’s gonna cost you.

Categories: data science, modeling, news

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