[FoRK] The Looter's War on Selfishness

Stephen Williams sdw at lig.net
Sat Mar 21 09:02:53 PDT 2009

Jeff Bone wrote:
> I found this bit of eleemosynary naivete from our glorious 
> anti-capitalist leader chucklesome:
> -- 
> http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9130129 
> Obama's advice was offered on The Tonight Show with Jay Leno (See 
> video). "We need young people, instead of -- a smart kid coming out of 
> school, instead of wanting to be an investment banker, we need them to 
> decide if they want to be an engineer, they want to be a scientist, 
> they want to be a doctor or a teacher," the president said.
> -- 
> So, first:  apparently Barry is unaware that the most effective folks 
> in finance, investment banking, etc. indeed *have* engineering and 
> science backgrounds, coming to finance from various engineering 
> backgrounds, computer science, physics, pure math and applied 
> statistics, and so on.  So he's arguing against something that's 
> clearly a natural trend.  Why *would* such technical folks make that 
> transition?  Simple:  it's better for them financially;  i.e. it is 
> easier for them to monetize above-average intelligence and vision this 
> way.  And it likely always will be, unless we dispense with markets 
> entirely.  A secondary trend is in technical folks making that 
> transition after dabbling in entrepreneurship (case in point.)  The 
> motivation there, typically, is in having seen good ideas stalled and 
> value-capture reduced or minimized through the input of hordes of 
> non-technical would-be business experts (MBAs) and meddlesome venture 
> capitalists without vision, through the inefficiencies and other 
> damage to our capital markets, and through the punitive impact on 
> risk-reward of e.g. tax policy.  (Obama wants more entrepreneurs?  
> Then stop gunning for them with all your socialist tax-talk, asshole!)

I think we'll likely be better off with masses of scientists, engineers, 
and other direct-benefit professionals and a few key financial people 
than the reverse.  Most of that intellectual talent could have been put 
to better use than a giant set of pyramid schemes.

A financial trader in AIG's London office is not a very useful kind of 
entrepreneur, if you can even use that label.
> And for the record:  despite the current climate and the general 
> activity that got us there, it's the actions of financial engineers 
> --- not the actions of the Federal Reserve, US Treasury, and federal 
> government --- that ultimately hold the best long-term promise of 
> maximally stabilizing the devastating boom-and-bust cycles that create 
> these problems.  But to get there, we need a science of financial 
> engineering rather than an alchemy of it.  This would 

It is being argued that the unregulated nature of the current situation 
is what is creating these mega-boom/bust cycles.  We'd be better off 
with small, more natural ones perhaps.
> be promoted much more quickly if we recognized and treated financial 
> engineering as a first-class science that could be pursued entirely 
> from undergrad to doctoral levels, rather than encouraging folks from 
> other disciplines to transition and experimentally try out formulae 
> from their own domains in the realm of finance, cf. Navier-Stokes from 
> fluid dynamics == Black-Scholes, Gaussian copulae from various places 
> as pricing models, etc.
> As for wanting to be a pure scientist, well, first of all they've 
> never made bank (pun intended) even in the best of times, though this 
> was largely offset by the affordances of the insular academy.  Over 
> the last several years, though, the War on Science has clearly 
> degraded an already unattractive situation.  So that at least is one 
> thing that Obama and friends could address in a positive way.

Some have.  Even in other countries.  Many tech startups are anchored 
around a scientist / engineer / inventor.  When successful, they do 
pretty well.  I don't see your point at all.  I don't think that 
financial is where the most money should be made.  Just because the 
money flows through those traders doesn't mean that they should be 
siphoning off so much.  That is not an efficient market in my mind, 
unless all possible alternatives are worse.
> Re: doctors, why in the world would one want to incur the cost given 
> the abysmal reward situation that already exists -wrt- fighting with 
> insurers (including *primarily* the government!) to get paid, constant 
> and increasing micromanagement of practices by government of all 
> levels, and the looming possibility of, essentially, nationalization 
> and / or complete governmental managerial takeover of the private 
> practice?  No, Mr. Obama's grand vision in this regard is likely to 
> decrease the interest in pursuing this profession despite whatever 
> pleas he might make.

That clearly needs to be fixed.
> Re: teachers, the reward picture there is *so* broken that it's clear 
> why we get only the bottom feeders moving straight into that 
> profession.  This, in my mind, is a *perfect* existence proof / 
> example of the counterproductivity of public management of essential 
> processes.  Given the meddlesome involvement of government at all 
> levels in education, the tendency is to drive quality away --- with 
> obvious results.  Almost nobody with any true skill as an educator 
> really *wants* the life the government allows them to have in that 
> profession;  only a few zealous and passionate capable few choose 
> this, while hordes of less capable / competent / talented folks choke 
> the ranks, fighting to get at the public tit.

I think teachers should get a bonus / retirement based on the tax base 
of their past students, perhaps over some threshold.  They're all at 
minimum wage?  Nothing.  50% professionals, making $200K+, then you make 
bank.  Hard to adjust for situational advantages, however it could be 
spread around in the right way.  You would likely have to have faster 
feedback, so you would have to translate success in High School to bonus 
for elementary, etc.
> Increasingly it is apparent that we are experimentally testing _Atlas 
> Shrugged_.  Indeed, a crude, cartoon version of it;  and as much as I 
> like the message of that novel I wouldn't have thought such a thing 
> possible, given how crude and cartoon-like it is in its construction.  
> Life, it seems, imitates art --- badly.

Never confuse the delivery quality with the idea quality.  That's a 
rookie mistake.  ;-)  Not that she seems to acknowledge second and third 
order motivation, which, through the principle of enlightened 
self-interest, creates government programs that seem, at a simplistic 
level, to conflict with her philosophy.

I don't see too much of a pure Atlas Shrugged "to each according to his 
need" parallel to recent events.  In particular, on the bonus flap, it 
is exactly the point that the AIG CDS traders did not earn their bonuses 
in some obvious sense that is causing the outrage.  Same with corporate 
heads of functionally bankrupt companies with large bonuses. 


> $0.02,
> jb

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