Monday, September 28, 2015

The Drain Approaches

So, we're about at the halfway point since I made the following prediction, half in jest, as my version of the Julian Simon bet:
Shorting the rand against a trade-weighted basket of currencies will earn positive abnormal returns over the next ten years.
This was based on nothing more than my hunch that South Africa is a country circling the drain.

How are we doing so far? Well, ignoring the trade-weighted bask bit, here's a partial answer:

The saddest incorrect prediction in geopolitical terms is that it can't possibly get any worse. The Zimbabwe lesson is that it can always, always get worse.

It gives me no pleasure to say that I told you so.

Tuesday, September 8, 2015

Of the Personal and Statistical

The current Syrian refugee crisis in Europe is a tragedy.

Should that sentence strike regular readers as a little trite, bear with me. I mean it in the classical sense that the Greeks thought of tragedy.

It is calamitous, deplorable, cathartic. It is a sorrowful tale of human misery stemming from root causes of human folly and flaws. It is a tale whose outcome the audience knows in advance, as they have seen the story many times before. It could have been prevented, perhaps, but we all knew it wasn't going to be.

The modern bastardisation of the concept of tragedy is that of a simple morality play, where good and evil are clearly delineated ahead of time. In the Disney-fied version, the upshot of all the sorrow is the lesson that Something Must Be Done.

I feel much has been lost by the Disney-fication of drama. We can no longer see the sadness of tradeoffs, of characters who are simultaneously victims and authors of their own misfortune, of the inevitability of human suffering.

So what, then, is the ultimate tragedy on display in this case?

It is this:

Individually, any one person is the undeserving and unfortunate victim of their broken society.

Collectively, all the people in a society are the reason that the society is broken in the first place.

Now, my instincts regarding public policy lean strongly towards emphasising the general, statistical formulation over the particular, personal formulation. The formulation as written may seem to suggest the primacy of the second statement over the first.

But do not misunderstand me here. It would not be a tragedy if it had such a simple resolution as that. Both parts are true. Try just reversing the order of the two statements to get a different feeling. The most common statement about the general and the specific has a very different connotation about which should be preferred. It is attributed, perhaps apocryphally but understandably, to the great monster - one death is a tragedy, a million deaths is a statistic.

The specific of the Syrian refugee exodus you have almost certainly seen by now. It is heartbreaking, and does not need any particular explanation:

Oof. The sheer sorrow hits you like a punch in the guts.

People's second thoughts after seeing this photo will vary wildly. You may be furious at the policies that let this happen. You may be suspicious of your emotions being manipulated here. You may wonder about what should be done in response. This is the intellectual question - what you make of it all.

But before that, I am almost certain your first thoughts, like mine, were of sadness and despair. Imagine if that were your child.

Humans are endowed with two great traits - empathy and reasoning. Those without empathy are sociopaths and monsters. Those without reasoning are dangerous imbeciles and fools.

Empathy yearns to try to end this senseless suffering by those in the middle of this war by granting them refuge. This is attempting to ward off the Scylla of heartless cynicism, and the gleeful egg-breaking-in-the-pursuit-of-omelettes that characterised the worst tyrants of the 20th century.

But what, then is the Charybdis? What gets ignored if we do not think about the general proposition?

Reasoning wants to know why Syria is the way it is, and what consequences will flow from possible responses to the current war.

What tends to get seldom emphasised in the face of such grief above is the heuristic I always associate with John Derbyshire (though I can't remember exactly where he wrote it) - that the more migrants you bring in from country X, the more your own country will resemble country X.

Several things are notable about this proposition.

One, it is extremely straightforward.

Two, it does not depend on one particular theory of development, and holds for many socially acceptable theories. If you think that poverty is driven by childhood nutrition, the result still holds, as long as the current adults are already impacted by malnutrition from years past. If you think that current ethnic conflict has its roots in colonial history, the result still holds, as long as the hatreds do not disappear upon touching foreign soil. As long as the trait is observable in citizens and fixed in the short term, then the Derbyshire result holds at least in the short term.

Third, it is completely outside the Overton Window of acceptable opinion.

But is it true? You will have to decide that for yourself. The general result is always uncertain and contingent in a way that the emotional result is not. You have to dig a little deeper to find out. Why is Syria the way it is? And how much of that will be replicated if there is extensive Syrian immigration to a western country, such as from a refugee resettlement program? Hard to say, precisely. But here's something to ponder, from Australia in 2012:

A forum discussion on SBS TV's Insight program looking at the uprising in Syria further exposed the divide amongst Syrian Australians over the conflict....
The main sectarian divide in Australia's Syrian community, though, is between the two main Islamic sects, Shi'a and Sunni....
In February, a group of men stormed the Syrian embassy in Canberra, smashing up the ground floor.
Three staff members were there at the time but no one was hurt.
Just days later, there was a shooting in Sydney apparently linked to the Syrian conflict.
The injured man, Ali Ibrahim, was an Alawi, like Syrian President Bashar Al-Assad.
After expressing pro-Assad views on Facebook, he was shot three times in the legs on the doorstep of his home.
His father, Jamel el-Ali, believed it was a warning from the anti-Assad camp.

It doesn't punch you in the guts in quite the same manner, does it?

But to the thinking person, rather than the feeling person, alarm bells are ringing. Australia did not used to be a country where embassies were stormed and people were shot for expressing political views in public forums. At the moment, this is at a small scale. But how many Syrians can one admit before this is no longer the case? If you bring all of Syria into your country, will you not have simply replicated Syria somewhere else?

This is all well and good, the particularist responds, but how many dead children are you willing to see washed up on a beach in order to forestall this speculative possibility?

It's a good question.

To get a flavor for the generalist argument, it is sometimes necessary to examine it in contexts that do not raise immediate emotional responses. Such as, for instance, the late Roman Empire's decision to allow in hundreds of thousands of Goths. Steve Sailer has a great summary of Edward Gibbon's take on the consequences of that here.

I suspect that the particularist temptation is to wave this away as a largely abstract and irrelevant example. It doesn't resonate emotionally, that's for sure.

But the human catastrophe that resulted from the destruction of the Western Roman Empire was a tragedy that affected Europe for the next thousand years.

If you're waving that away, which one of us is sounding like Stalin now?

The Charybdis, in other words, is that you become so focused on the emotional response to a single death that you forget to think about the long-term consequences of your actions, and end up causing many more deaths.

To my mind, the starting point of the answer, is to shut up and multiply.
This isn't about your feelings. A human life, with all its joys and all its pains, adding up over the course of decades, is worth far more than your brain's feelings of comfort or discomfort with a plan. Does computing the expected utility feel too cold-blooded for your taste? Well, that feeling isn't even a feather in the scales, when a life is at stake. Just shut up and multiply.
Whether a policy makes you feel good is less important than its ultimate consequences. Of course, this then comes back to your view of why the third world is the third world. This is why 'shut up and multiply' is only the start of the answer, not the end of it.

It would be ideal if the policy formulation that saved the most lives in the long run also made you feel emotionally good in the short run.

But what if the two aims are at odds? Are you willing to look clear-eyed on the photos of dead children and still see the lives that you think you're saving by not doing anything? Will you waver? Should you waver?

Uneasy rests the head that wears the crown.