The Electoral College Can Save US

I am nowhere close to a Trump supporter. The man has shown that he has zero moral consistency, his only consistent trait this election has been his impulsivity and erratic behavior. That being said, one issue has come up while browsing the news and my social media feed, the electoral college. There are people who wish to abolish the electoral college because Hillary won the popular vote, and many more who are urging the Electors to become “unfaithful” and divert their votes to Hillary instead of Trump. Typically these are the same people.

Many point out the fact that Hillary won the popular vote, I would like to point out the fact that she won by .27%. If .14% of voters, a mere 90’000 people had decided to vote for Trump we wouldn’t be having this conversation. Instead, we would still be egging the Electors to divert their votes. This is why I think that tossing out the electoral college seems short sighted, sure it may have been a bust this time, but what about next time? I don’t think that everyone who holds these two opinions simultaneously are hypocrites, but it’s likely that many are. I doubt people would even talk about the electoral college if an additional .14% of voters had decided instead to vote for Trump. Of course, the main objective of all these plaintiffs is to stop Trump, still many try to stand on the high ground posting about how the Electoral College is obsolete (it’s weird that so many people are passionate about the Electoral College all of a sudden). At the end of the day, I think it’s important to look at how institutions that fail can actually prevent “catastrophe”, and maybe we shouldn’t be arguing based on .27% of voters preferring Clinton.

Additionally, we had a popular vote system, it may have been the case that even more Trump supporters would have voted, as there would be no “safe” deep red or blue states. Take Texas, which had a voter turnout of around 42%, if 3% more had went to the polls, Trump probably would’ve won the popular vote. The Electors probably won’t vote for Hillary, but who knows with this election. All in all, I don’t think that getting rid of the Electoral College would have definitively solved anything this election cycle. We should view the Electoral College as a component of the checks and balances that are a strong part of American Democracy. I’m be willing to bet that this whole movement will basically shut down if Hillary actually wins the election due to unfaithful delegates.

China’s Rising Uncertainty

From an article on zerohedge:

Once again, on a Saturday night (US time), Sunday morning (China) a sudden burst of buying pressure in Bitcoin, driven by Chinese buyers, has spiked the virtual currency higher on dramatic volume. With Bitcoin now trading at its highest level since May 2014 (in Yuan), and up 250% since we first suggested this an outlet for desperate-to-leave capital outflows in September, we note that the ‘arbitrage’ of over 150 Yuan points to massively more demand from Chinese buyers for now.

This is an interesting development for monetary policy, and an interesting development a sort of prediction market about the future of the Chinese economy. The Chinese economy will likely go through a great recession of its own. However driving up the price of bitcoin is an incredible way of measuring perceived risk in future investment, although it is unlikely to harm Chinas exports.

A Brief Note on Divestment Tactics

In a previous post I expressed a few of my qualms with the divestment movement. Although I would consider myself a pragmatic environmentalist, I disagree with campaigns to move away from fossil fuels. Yet, I can’t help but think of how they could achieve the goal of a “greener” planet more effectively.

  1. Don’t target the Industry as a whole, this is unlikely to yield any beneficial long term momentum.  There is no complete replacement for fossil fuels yet.
  2. Since there is no alternative energy panacea for fossil fuels, it makes little sense to demonize an entire industry that is, at worst, a necessary evil.
  3. Some firms in this industry are more environmentally friendly than others (maybe their regulatory compliance is better).
  4. Some firms are more environmentally destructive.
  5. Targeting specific firms for greater accountability would be more effective than targeting an entire industry that civilization depends on.

Protests against non-union grape farmers or the Birmingham bus boycott were specifically targeted and had clear substitutes. With grapes it was easy to just not buy grapes or buy grapes from farms that didn’t need to be unionized. With the bus boycott people could walk or carpool, it wasn’t a protest that involved not using any transportation at all, ever (its also worth noting that the bus company wanted to desegregate soon after the protests started, it was only the law that held them back). With energy, there is no clear substitute for fossil fuels, with the exception of nuclear in non-transportation energy production. Total industry divestment means pushing towards an energy system that can’t feasibly be meet our needs. All things considered, why not push for a cleaner environment instead of taking a total stand against the fossil fuel industry that reliably powers our hospitals, refrigerates our food and vaccines, and enable humans to travel the world.

Legalizing Heroin

In my home state of Massachusetts, we are currently going through an opioid “epidemic”. There certainly more people using opioids now than 10 years ago. It’s incredibly hard to detect an true drug epidemic . To make policy decisions even more difficult there is certainly a global pain epidemic. Drug laws do more harm than good and are the product of public outcry. I find that some people get angry at the idea of heroin being legal or even decriminalized.

The next question to ask: “have many drug users’ lives been made better by sending them to prison?”. There is a high probability that the answer is no. This is especially likely if you know someone who has been arrested for possession or distribution of marijuana. Marijuana is currently the drug gaining the most traction towards decriminalization/legalization. This is great news, but a worrying prospect is that the “end the drug war” types will stop with that victory.

There is a sentiment that marijuana is essentially harmless and that all other drugs are bad. Marijuana is certainly less harmful than most substances, but public perception is still highly inaccurate when assessing other drugs.  When asked if someone without any prior offenses was caught with a small amount of heroin, 13% of Americans favor “A fine or no punishment” which is higher than many expect. Yet 10% favored imprisonment for “10 years or more”. This poll is 3 years old, and the “heroin epidemic” has been getting more attention, especially in Massachusetts. Recently governor Charlie Baker emotionally signed a new law that is rather toothless at best, and at worst an annoyance. Patients have to go back to their doctors after a week to get a new painkiller prescription, adding to the cost of having a pain problem whose severity requires opioids.

Aside from all the moral panic going on, teen drug use has remained stable or declined in the past decade. The number of high school students who used heroin or painkillers sometime within a month-long period prior to being surveyed (an important statistic to indicate addiction) has been declining over the past decade as well. Dr. Carl Hart estimates that only 20-25% of all heroin users are actually addicted using the measure of disrupted socioeconomic functioning. Governments measure overdoses using incredibly inaccurate methods, typically if someone dies with opioids in their system, it is counted as an opioid-related death. The public fear of opioids as the result of flawed government reports and anecdotes puts pressure on legislators, regardless of what they actually think, to do something. An overdose death has an immediate emotional impact, while someone who dies from lung cancer after decades of smoking isn’t as visceral. Although people may favor making cigarette-smoking illegal, virtually none would want to impose a 10+ year prison sentence on someone for smoking.

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Behavioral Health Trends in the United States: Results from the 2014 National Survey on Drug Use and Health

 

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(Monitoring Future National Survey Results on Drug Use 1975–2014)

 

People engage in all kinds of unhealthy behaviors. Some people eat a big mac and drink Coke while other people smoke weed or crack. More importantly, we retain more users in the health system when heroin use isn’t a criminal offense, which allows people who truly have a problem to ask for help with relative ease. People could sue heroin producers for making drugs of questionable quality, which is a moderate factor in drug overdoses. They could also tarnish a producer’s reputation by some other means (rating websites, etc), creating a market incentive to produce the “good stuff”. Additionally, moving the drug trade from black market to free market internalizes the cost of the industry. Drug enterprises would have to compete for customers rather than fight with other gangs over turf in zero sum games. A large number of violent deaths could be reduced by legalizing drugs. I’ve never heard of Budweiser having a shootout with Corona over product placement at a bar.

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Divestment is terrible

Northeastern, Harvard, and UMass Amherst all have divestment movements. These are largely symbolic campaigns against University endowments investing in the fossil fuel industry. They claim to represent the global poor and the impact of climate change on their communities. Their ideology doesn’t reflect todays economic reality, and does more harm than good.

Many in divestment campaigns want to harm the fossil fuel companies in some way. This is a fledgling movement and they will need to get to the size of the colossal divestment protests of South African companies. Yet, even the massive anti-Apartheid divestment campaign had no impact. Shares were pretty much bought up in seconds when an institution divested. They don’t harm the financials of the fossil fuel companies.

An argument that attempts to make up for the fact that it will hurt colleges’ financial portfolios is that fossil fuels are only a short term investment. This argument is terrible from the beginning. First of all, fossil fuels wont run out for hundreds of years, and we’re constantly finding more and more. People then point to the example of a college in Maine that divested from fossil fuels and then made up for the gap with increased donations. Does a temporary increase in donations seem like a long term solution compared to the hundreds of years it will take the earth to run out of fossil fuels? Additionally, decreased revenues from investments in fossil fuels will raise tuition and cause more students to take on more debt. A symbolic gesture shouldn’t cause other people to suffer.

Next up: the fact that they claim to represent the global poor. I doubt many of them have met the real global poor, those that Paul Collier calls “The Bottom Billion”. These are people who are living on less than 1.25$ a day, a poverty line defined by the United Nations (although Lant Pritchett contests that low number). These past two decades are likely the best that humanity has seen. Climate deaths are down 99% over the past 100 years. Note, that the population in 1900 was 1.6 billion and today it is over 7 billion. Storms may be growing in intensity, but industrial civilization is clearly becoming more “climate resistant”. People need electricity to preserve vaccines and other medications, to use modern farming equipment, and for running industrial activity to escape poverty and starvation. Moreover, everyone knows that more energy allows civilization to do wonderful things.

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Symbolic gestures may have their place, but don’t make other students pay for your symbolic gesture. Now if divestment campaigners were willing to take on any debt that other students might take on, I wouldn’t be complaining. All in all, divestment campaigns don’t harm fossil fuel companies, they have no panacea alternative to hydrocarbons at the moment, and this will not help the global poor. These campaigns do not take into account other student’s financial situation, and I doubt the global poor are watching this movement with bated breath and tears of joy in their eyes. Best case scenario, many students waste tons of collective hours for no reason.