Krugman discovers humans are not rational

Paul Krugman is a fan of behavioral economics. He’s also fabulously well read, he must have read some anthropology, history, and political science at some point in his life. At heart though, Krugman is an economist. It’s hard for an economist to escape the prejudice that humans are fundamentally rational self-interest optimizers. It’s baked into their culture.

Alas, humans are only partly rational part of the time*. Obama, like every politician, knows this in a deep way. That’s why he ignores Krugman’s political advice.

Krugman can learn though. I’ve read him religiously since he became a byte-stained wretch, and he’s changing. He’s learning politics (emphases mine) …

Krugman - The G.O.P. - Going to Extreme - NYTimes.com

… Right-wing extremism may be the same as it ever was, but it clearly has more adherents now than it did a couple of years ago. Why? It may have a lot to do with a troubled economy.

True, that’s not how it was supposed to work. When the economy plunged into crisis, many observers — myself included — expected a political shift to the left. After all, the crisis made nonsense of the right’s markets-know-best, regulation-is-always-bad dogma. In retrospect, however, this was naïve: voters tend to react with their guts, not in response to analytical arguments — and in bad times, the gut reaction of many voters is to move right.

That’s the message of a recent paper by the economists Markus Brückner and Hans Peter Grüner, who find a striking correlation between economic performance and political extremism in advanced nations: in both America and Europe, periods of low economic growth tend to be associated with a rising vote for right-wing and nationalist political parties. The rise of the Tea Party, in other words, was exactly what we should have expected in the wake of the economic crisis…

Better late than never. The new Krugman will be even more interesting than the old one was.

* I suspect on average, over time, the system in which we are embedded is more rational than it seems, but that’s another post. (Yes, sounds like “psychohistory”, and, yes, Krugman, like me, grew up on Asimov.)

Jean-Louis Gassée on Cloud 2.0 – post of the month

Jean-Louis Gassée blogs on Monday Note. He’s been doing it since Feb 4, 2008.

Gassée has done many things, but he’s best known for having been Apple’s CEO for a time. These days he’s a VC “general partner”. It’s safe to assume he’s rich beyond my paltry dreams of avarice. Why does he bother writing a not-terribly-famous blog? I don’t think it’s for the adword revenue.

My best guess is that he’s helping out the blog’s co-author, and that he writes for love. Alas for those who write to live, his free stuff is better than the best of the WSJ. Such is the curse of early 21st century journalism.

Today he takes on the Google-Microsoft cloud apps war. It’s fantastic stuff (emphases mine) …

Cloud 2.0 - Monday Note

… Last year, Microsoft’s total sales were $58B, down 3% from 2008 … Note the Operating Profit, 35%. The company spends 15% of its revenue in R&D and 28% in Sales, Marketing and General Administration….

… Compare this to Apple’s 29.5% Operating Profit, 3% R&D, and 9% SG&A [selling, general and administrative expense] with a comparable revenue level, in the $50B to $60B range annually…

… Microsoft’s Net Income is 25% of revenue, Apple’s is 22%….

… Microsoft Office represented 90% of the $19B Business Division sales, with a nice 64% Operating Profit … Roughly 60% of all Microsoft’s profits come from Office and a little more than 53% from Windows OS licenses (or what MS calls its “Client” business):

So… Office + Windows, 60% + 50% = 110% of Microsoft’s Operating Profit? The math is complicated by the losses in something called “Corporate-Level Activity”… …and, more importantly, by the hefty 73% operating loss in the company’s Online Services Business:

If I’m interpreting Gassée’s writing correctly, Apple’s numbers are only comparable to Microsoft’s because Microsoft “wastes” a huge percentage of revenue. Microsoft’s R&D percent spend is 5 times Apple’s and Microsoft spends 3 times as much on selling, general and administrative expense – not to mention “corporate-level activity”. If Microsoft were as stingy as Apple, their profits would be mind-blowing. Microsoft Office is a money-factory.

I’m reminded of an old Cringely column, in which he opined that Microsoft could have any profit number it wanted to have.

Gassée continues from numbers to user experience, saying the same things I’ve whined about but that, honestly, I never see mentioned anywhere else

.. Google Apps aren’t Office killers. I’ve been using Gmail in both the free and paid-for accounts. The basic email functions work well, but managing contacts is awful. (Months ago, I heard Google had an internal project called Contacts Don’t Suck. I’m still waiting.)…

… I’ve tried to use Google Docs to write, share, and edit these Monday Notes. Failure. Compared to any word processor, Google Docs feels clunky and constrained, and hyperlinks die when you download the document…

… Google Apps aren’t “there” yet. They’re still clunky, to say nothing of managing the “stuff behind the desk”. They’ve been quickly upgraded–perhaps too quickly– at the expense of the user experience. If managing Google Apps is as complicated as running an Office DVD install program, an important part of the Google theory falls apart. We see the trumpeted announcements of large organizations and governments that have turned to Google Apps, but what we don’t see is a courageous journalist going back to the proud early adopters a year later to tell us what actually transpired.

So why is it that only cranks like me and outliers like Gassée ever point out where Google fails? It’s a bit hallucinatory. Gmail’s contacts function has been terrible for years (starting with the weirdly isolated link to “contacts” in Gmail). Google Docs are still very weak (though about to move up a notch), and things are worse when you look at the channel confusion around Blogger, Google Doc, Buzz and Google Sites.

Really, I do love a lot about Google, but they have to give up on the idea that good design is emergent.

Go and read his Cloud 2.0 post and the “related columns” he references at the end. Don’t forget to marvel at the strange age we live in, where some of the best journalism is done for love*.

* P.S. As a bone to the pros, Gassée drops a broad hint on how they could write something interesting – go to the early adopters of Google Apps and tell us what happened.

My top two blog posts - lessons in markets and humility

I have written over 10,000 blog posts (well beyond Google's 9 month old 5000 post bug), largely for myself and proto-skynet. I imagine some are clever, at least to me.

Of those 10,000, 0.02% get 99% of the comments. Those two are not the clever ones ..

• My MacBook fan was roaring. Why?
• Duct tape and warts: how the HECK does it work?

I'm happy with the first one, though bemused that of all my tech posts this is the one that caught on. It is a more than annoying OS X limitation that a device driver can overheat machines for months or years -- and that Apple store employees sell batteries or replace machines rather than kill a stuck job ...

David H Cape Town said ...

Thank you, Apple store couldn't fix the problem, they just sold me another battery, the new battery power was 50% of what it should be-the roaring fan being all consuming! Once I deleted the Canon printer and a dozen jobs stuck in the queue the fan stopped immediately after blowing for 6 months!

The second is embarrassing. Warts are fascinating, but we really don't know if duct tape does anything special, or anything at all. This kind of unfunded research is, in its own way, as subject to publication bias as very well funded antidepressant research.

Of course I am, as ever, compelled to apply a learning pattern to these findings ...

1. I am very bad at judging what a large number of people will find interesting.
2. If I were trying to attract readers, I'd write more wart posts.
3. Apple needs to revamp their retail training and their technical support algorithms.

Fear the Cloud: Remember the Milk

Remember the Milk, a cloud-based task management service, disabled sychronization this week with Appigo's ToDo.app.

There was no warning. RTM customers who used ToDo.app simply lost sync services.

Fear the Cloud.

Identity: Legion is a character defect?

Last February I wrote The Buzz profile problem: I am Legion.

It surprised me that I had to write the post. I thought it was self-evident that adults have many identities. Google's Buzz flop made me realize I was wrong. Obviously a lot of Googlers missed the obvious.

Google may be catching on. Not so Facebook's master - Mark Zuckerberg ...

An Internet Where Everyone Knows You’re a Dog — Crooked Timber

...While searching for evidence of Zuckerberg’s broader philosophy of information, a passage from David Kirkpatrick’s forthcoming book, The Facebook Effect, is quoted:

“You have one identity,” he emphasized three times in a single interview with David Kirkpatrick in his book, “The Facebook Effect.” “The days of you having a different image for your work friends or co-workers and for the other people you know are probably coming to an end pretty quickly.” He adds: “Having two identities for yourself is an example of a lack of integrity.”

Zuckerberg is famously young, and famously wealthy. He has not had to grow up; he may never have to grow up.

Adults have complicated lives. Adults have parents, and children and grandchildren, patients and students, employers and colleagues and staff, friends and neighbors. Adults live in a crowded world where wisdom and compassion means muting the self, juggling the complexity of contextual identity. What we used to call, in medical school, being professional.

Zuckerberg is not an adult. I know where he's coming from. As an aspergerish teenager I might have made the same mistake.  He'll likely grow up one day and realize he goofed.

Problem is, we can't wait. He's rich enough that growing up may take a very long time, and for that time he'll be running Facebook.

I'm winding down my Facebook presence; I'll let it die a natural death. If Google or someone else provides a smarter alternative, I'll encourage friends and family to switch.

Verizon iPhone – Can you hear us AT&T?

The WSJ is on board. The CDMA Verizon iPhone is expected after September (Sprint,also CDMA, too?). The AT&T iPhone will be shown in early June, probably available end of June.

My wife’s iPhone AT&T contract should be up in the Fall of this year, my contract expired last January. We have no reliable AT&T iPhone voice service in our St. Paul home. This is a big change from a year ago when iPhone service in MSP was fair to good. We’re paying for services AT&T can’t deliver – because they oversold their capacity.

We’re ready to switch.

If AT&T wants to keep our $2,400 plus/year family fees they need to do one or more of

1. Fix our home voice service.
2. Provide a free MicroCell for home use with some extra benefits.
3. Dramatically reduce our phone bill.

It will be a great relief to have Verizon on board no matter what we do.

If we stay with AT&T, the combination of a likely 10% drop in AT&T iPhone users and a large decrease in new AT&T iPhone customers will improve service quality and dramatically reduce the cost of a used AT&T iPhone.

If we switch to Verizon (Sprint?) we’d get 3 new 4th generation iPhones and our old devices will become iTouch-equivalents.

Can’t happen soon enough.

Hours worked per year: Greece in #2 spot

Sure, South Korea is #1 at 2,256. We knew that. (China isn't on the chart, it would presumably be in the SK range.)

But who's #2?

Ok, so I gave it away. Would you have pegged Greece at 2,120 hours? Greece, home of economic collapse and rumored early retirement? Yes, there are lots of caveats about data quality, measurement definitions, etc. Still.

Maybe after working 2,120 hours a year early retirement is mandatory. FWIW I have read that Chinese employment beyond age 50 is very challenging. In many nations "early retirement" is really "early termination". I suspect effective "retirement" age in post-industrial nations is going to fall, not rise.

Germany is way, way down at 1,430 hours a year. Poor impoverished Germany.

Oh, wait.

The US, Japan and average OECD are all at about 1,760 hours. Indistinguishable.

Canada and the UK are a bit lower at about 1,600 hours. In general, the more sane and wealthy the nation, the fewer hours worked per year. I'm looking forward to some interesting infographics illustrating those comparisons.

Google's DLF - The data privacy connection

I rail on Google, but they're a long way from Facebook on Gordon's scale of corporate evil.

Facebook has zero-forwarding email. Google has the Data Liberation Front -- and they take requests. There's no comparison.

DLF fan that I am, though, I was puzzled by an alleged connection to customer privacy ...

google's letter to privacy commissioners. DLF cited as "[an effort] to protect customers' privacy and promote transparency."

What does data freedom have to do with customer privacy? Sounds like PR-speak. I could think of only one connection, and the DLF confirmed it for me:

Data Liberation gives people a way to revoke their trust in a company if they're not pleased with the way the company is behaving.

Whitewater age: Nashville edition

Over 1.5 million people live in the Nashville metropolitan region. Median urban family income is $50,000. Vanderbilt university is a major player. Nashville is a significant American city.

About a week ago it was devastated by flooding. It's a federal disaster area now. I only know because I've visited there on business, and I have colleagues living there. Maybe it got some TV time, but it didn't get much notice in my media stream.

In the 1990s the Nashville floods would have received full spectrum coverage. Now, between market chaos, historic oil spills, the collapse of Greece, and the rest, it's just background noise. If Katrina hit today, it would probably get coverage for a week.

The world has changed a great deal in 15 years. Admittedly the 90s were an anomaly, a time when people could talk, with a straight face, about the "end of history". The early 20th century was not exactly placid. Nineteenth century America was flat out turbulent.

So these are not unusual times -- except in the context of our generational memories.

White water is the new normal. Ahead lies Peak Oil, climate transitions, immense environmental and sociopolitical change across the globe, and, perhaps, far worse.

We will become accustomed to the chaos; just as Beirutis seemed to grow accustomed to urban life in a war zone. Today's college students, however, will have to endure the boomers mourning the golden age of the (Bill) Clinton years.

I miss the 90s.

Ken's Concertina

About 3 years ago I took some pictures of a friend disassembling  a concertina. Here they are, for anyone with a concertina interest ...

Ken's Concertina

Social Fail: Room for one more

Buzz is still floundering. The alternatives aren't any better. The big three all have problems (caveat: I know FB best, Twitter least):

Twitter: Missing multiple "account" (identity/stream) management. SMS based string limitation.

Buzz: Missing identity/pub stream management, overpowering ties to critical Google identity (heavy baggage, gmail, etc). Public profile by design. Lazy "if it sticks" design. Cross-Google coherence problem (Reader notes, Orkut, etc).

Facebook: Malign business model. Zuckerberg.

Of course there are other alternatives to consider. There's AOL, Yahoo!, Microsoft, Myspace, the Wall Street Journal, IBM, Oracle, Walmart, Newsweek ... Right. All equally irrelevant.

The big three are, amazingly, missing the target.

There's room for one more.

WWAD?

What would Apple do?

See also:

• The Buzz profile problem: I am Legion
• Google's latest inadequate Buzz patch - Profile deletion
• Good-bye Buzz – for now.
• Reimagining realtime focalcast communication – Buzz and Twitter 2.0

Update 5/10/2010: Google knows they're flailing. That's progress!

--My Google Reader Shared items (feed)

Gallery of 56 Chinese ethnic groups

This gallery of 56 Chinese ethnic group portraits is both marvelous and overwhelming. Dienekes has organized them by group (interesting comments).

I wish the images were much higher resolution. There's so much more I'd like to see.

Jackpot: Leonard predicts oil spill in 2008

There should be a blogger prize for best medium term prediction. Leonard gets my vote for his 2008 prediction, quoted by him in today's article...

How to guarantee a Gulf oil spill - How the World Works - Andrew Leonard Salon.com

... Try, if you can, to ignore all the lurid coke-and-sex bombshells contained in the three Department of Interior Inspector General reports about the shenanigans at the U.S. Minerals Management Service (MMS). The program director who snorted speed off a subordinate's toaster oven, and made her give him a blow job while driving around the neighborhood. The two "MMS Chicks" who were notorious for getting plastered at conventions and having one-night stands with oil industry employees.

Try -- and yes, I know it's hard -- try even to ignore the allegation that one program director told a subordinate that if she could score him some coke during the MMS performance appraisal period, he would increase her performance award. What's the big deal? Who wouldn't be motivated by such an incentive? And what's a little drunken sex and coke binging on government time among friends? It happens to the best of us.

The significance of the three reports delivered by the inspector general to Congress on Wednesday lies not in the prurience of some of the indiscretions, but in the symbolism. The Royalty-in-Kind Program of the U.S. Minerals Management Service is where offshore drilling meets the U.S. government. And gosh, is it ever one heck of a mess. You want a toxic oil spill in the Gulf of Mexico? Just read the reports.

That was the Bush modus operandi. Government must be destroyed, so turn it over to the incompetent and the corrupt.

How the Google Reader team decides what to do

Google teams are annoyingly driven by user requests. I prefer Jobs-style tyranny myself, but that's not the Google style. Different teams seem to follow different procedures.

For a time some used GetSatisfaction. The Google Reader team used to use a Product Ideas site, but then they went to GetSatisfaction.

Now they claim it's all forum and twitter...

Official Google Reader Blog: A little bit of polish

... The way we prioritized these tweaks and fixes was based on forum and Twitter feedback, so please keep it coming....

Right. I think they just make it up and talk to their buds.

Why don't they use GR comments?

Twenty minutes on the Deepwater Horizon

Deepwater Horizon.

Oil riggers on ship that exploded in Gulf of Mexico describe fateful night

... We're waiting to get everyone here before we go!' a supervisor yelled to Eugene and the other men who were waiting near the lifeboats....

They waited 20 minutes on the exploding platform. One hundred and fifteen lived, eleven died. A few jumped and swam to rescue boats, most took the two remaining lifeboats.

Twenty minutes waiting for survivors to run, crawl and be carried to the lifeboats.

Awesome courage.