Being French, I often deplore the cynical and negative attitudes of our culture, and always been more comfortable with the American positivism. This video is a refreshing reminder that positive attitude should not come at the expense of reality and truth. It is from journalist, author and political activist Barbara Ehrenreich. Video on YouTube
Democracy for the digital age
At dinner in NYC with Koen and Ann, we had a very interesting discussion about democratic processes. Belgium, France and the USA were obviously great material, respectively with their deliquescent state, banana republic, and polarised politics. Add to these a declining participation to the voting process, and it really looks like there is an opportunity to do better than these old democracies.
It should probably not surprise us, as our political representation systems date back from times when the fastest one could travel was on horseback, when most people lived tilling the soil, and few could read and write. The state then had much less complexities to manage, and the pace of change and decision making was measured in months, years or decades.
Isn’t it time then to move to more direct systems where citizens with access to immense amounts of data and analysis can directly participate in dialog, express their opinions, and take decisions without having to vote for “representatives” ?
This of course would be a huge shift, one that will be resisted by the current professional political class. It is also a complex one, which will require to reinvent all the safeguarding mechanisms, the checks and balances that took centuries to evolve.
But isn’t it already happening ? The political class in France recently showed how out of touch it was with the public opinion during the DSK sex scandal. They initially made statements supporting DSK, hinting that aggressive sexual advances was nothing to be fussy about, really an expression of French Don-Juanism. Within days or hours of their first reactions, they adjusted their stance, no doubt as their political advisors decrypted the online forums… The real-time data mining and analytics around social networks is already shaping the actions of politicians. We should probably take control of that process before they learn how to subvert it.
The most heartening piece of news this year so far !
As a 13 years old boy from New York was looking at trees, he observed that there was a pattern to how branches were positioned. Enquiring further, he found they follow a fibonacci sequence … Nothing extraordinary so far, this is a fact already known, except that few thirteen years kids will figure that out 🙂 … The extraordinary thing is that he then thought of comparing how solar cells placed using that pattern compare to a regular flat array of photovoltaic cells, and found that they generated 20-50% more power !!! Through natural selection, trees have apparently evolved over millions of yrars to adopt that configuration and increase the amount of energy they capture, but no-one had thought of using this for solar panels before.
This is such a refreshing story … One of curiosity, intelligence, and one that proves again that there is no limit to understanding more and more of the world around us, and use the learnings to improve our lives !
To read the paper written by that boy, Aidan Dwyer, himself, follow this link.
Nouriel Roubini at Project Syndicate
A must read article by the economist who became famous for forecasting the crisis, Is Capitalism Doomed ?.
This is posted on the “Project Syndicate” blog, where all the best minds in politics, economics, science, and culture post articles with deep independent analysis of the world trends. All the people I have been impressed by in the field of economy are there : Nouriel Roubini, Stephen Roach, Joseph Stiglitz …
3 Cs of Presentations
For each topic you want to present, you might want to follow the sequence below. In a typical PowerPoint presentation, this should be done for each single page.
Context … Tell the audience why you are going to discuss the topic, how it is relevant to them.
Content … Give your key message…
Colour … Close with vivid examples illustrating the point(s) your are making …
“The great stagnation : how America ate all the low hanging fruits” by Tyler Cowen
Just finished a book by Tyler Cowen, “The great stagnation : how America ate all the low hanging fruits”. It is a short book with depth, which lays out facts and ideas in a very crisp and engaging manner.
The author’s theory is that the US have reaped the low hanging fruits of productivity, and that its future material and financial growth is at risk. He details three key areas that fueled past productivity, but will not drive progress going forward :
– access to free land, from the 17th century to the end of the 19th century
– improvements in education. The percentage of the population graduating from High School grew from 6% in 1900 to 60% in 1960, and 74% today. Only 0.25% of people went to college in 1900, a number which has grown to 40% today. But we seem to have reached the limit of these improvements, as college drop-out rates have grown from 20% in the 60s to 30% now …
– a host of technological breakthroughs from 1880 to 1940. These have slowed down since then, and as the author puts there is not much difference between a kitchen or a house) today and one in the 50s in terms of the basic functionalities that had then become available (fridge, TV …). 80% of the economic growth from 1950 to 1993 actually came from innovations that happened before that time.
The author links that last point with the drastic reduction in the rate of growth of the median income, starting in 1970. His view is that discoveries since then have been geared towards private goods rather than goods for the larger public. The impact of the Internet is much more complex though and there is a whole chapter on that, which I will comment on later.
There is a whole section then looking at how we have tended to overestimate productivity through the GDP calculations :
– government spending is always factored in the GDP at cost, regardless of the utility or value created. This does not take into account the fact that as government grows there will be a diminishing return on that value. Since the 19th century the cost of government (excluding redistributions) has grown from 5% of GDP to 15-20%, which means we have overestimated the GDP growth, and the productivity, derived from that growth in spending.
– there is a similar issue with Healthcare, which is 15% of GDP in the US. Its efficacy is impossible to determine, and there is an established disconnect across modern countries between the spend, and metrics such as average life span.
– same thing with Education, which represents 6% of US GDP. Reading and mathematics scores at the age of 17 have not changed since the early 70s, while the expenditure corrected for inflation has doubled per pupil.
The looming question that the author then tackles is of the impact of the Internet. To summarise, he says that the Web provides huge innovation for the mind, not for the economy. It makes us happier and enables personal growth, but does not impact the economy very much, as so much of the content is free or very low cost.
So the Internet is also not properly reflected in GDP and productivity metrics, and that is one area where GDP underestimates the positive impact of technological change.
The issue though with the Internet revolution are the following :
– we have been counting on real productivity and material economic impact to generate future revenues and pay off our debts …
– the benefits from that revolution are unequally shared. Using the Internet positively is a function of one’s cognitive powers, while past inventions were usable equally by everyone.
– it creates few jobs. Google 20 000 employees, Facebook 1700…
The author then goes into an analysis of the current Economic crisis, which he sees as a result of overconfidence across our society in productivity. I am not convinced that should be the only explanation, but this is at least a refreshing view and a new angle.
Looking forward, despite the gloomy title of his book, Mr Cowen sees some positive future trends :
– india and china growth will create larger markets that will reward innovations again. They have so far grown by imitating the west, they will probably fuel innovation in the future.
– Internet might start generating growth. It creates a “cognitive surplus” (Clay Shirky) as billions of people are getting smarter and better connected, which would have positive effects on innovation.
– the Obama administration has taken steps to reform education
He conclude with an appeal to raising the status of scientists in our society, to make science and technology aspirational and rewarding careers for our children … Could not agree more !
“The stuff of thought” by Steven Pinker
This is a book that I have started reading twice already … Not a good sign ? More a sign of laziness on my part, as it is one of the most dense books I know. Each page holds more complex concepts and ideas per page than my brain and attention span can handle.
So before I give up reading it again, let me share the content of the piece I have managed to read through !
Steven Pinker (Wikipedia entry) analyses language as a window into the way we think. He starts by asking the profound question of ‘How do children learn language ?’, and especially focusing on how they know what NOT to say.
For example, one can say :
“I sprayed water onto the roses”
As well as
“I sprayed the roses with water”
We can imagine that hearing such multiple examples allows children to determine that there is a pattern, a rule. It could go like this : ‘if I can say “something actioned object a onto object b”, then I can equally say “something actioned object b with object a” ‘.
But that rule does not always work. For example :
While one can say
“I coiled a rope around the pole”
One cannot say
“I coiled the pole with a rope”
This is a very important issue, more than it first appears. We could try to explain that this is just an exception. But this itself poses another problem. How would children learn these exceptions ? They can determine patterns by listening to adults, but exceptions like the one above would require them to know what is NOT being said. The only way this could happen is for the child to make the mistakes, and get corrected. But this would require massive additional amounts of interactions which don’t seem realistic.
Fortunately there is another explanation offered by Steven Pinker.
We were looking for rules that would involve simple grammatical patterns. Instead it appears that the rule is about a mental picture of the action being performed. This is where the window into our underlying thought processes starts opening.
Our brain seems to classify verbs in categories that correspond to types of actions performed, but with distinctions far from obvious at first glance. For example, brush, plaster, rub, drip, dump, pour, spill all seem to pertain to getting some liquid or goo onto a receptacle. But the fact that you can “smear a wall with paint” while you cannot “pour a glass with water” tells you that you have to classify them in two different types of actions :
– the first type is when you apply force to both the substance and the surface simultaneously : brush, daub, plaster, rub, smear, smudge, spread, swab. You are directly causing the action, with a sense of immediateness.
– the second type is when you allow gravity to do the action : drip, funnel, pour, siphon, spill. You are acting indirectly here, and letting an intermediate enabling force do the work. There is also a sense of the action happening after you have triggered it, instead of immediately.
The fist type allows the “smear a wall with paint” construction, the second type does not.
Going further, the book explains how researchers have used non-existent verbs such as “goop”, telling children that it means wiping a cloth with a sponge, to test how they instinctively use these verbs, to test that the above rules apply … And they do !
So there IS a logical set of rules that explain how we talk, and these rules provide a glimpse into the mental models we use to conceive of reality, even before we verbalise our thoughts.
I hope I gave you a small taste of that fascinating piece of writing, and even more that you will become as curious as I am of this field of study. Another great book by the same author “How the Mind Works” attempts to explain the basic mechanisms we use to think, it is maybe an easier read, but is equally mind-provoking and fascinating.
Now for a sobering fact. When I tried to explain to Aouda what I had just taken hours to understand, she immediately latched on to the answer as something very natural and almost obvious. So some of us are more conscious of what’s happening inside our heads than others 🙂
What will it be for you ? Read one of these books and let me know !
Hans Rosling
Great conference video – you can download the program Hans Rosling is using at http://www.gapminder.org/ to play with the data yourself.
Oil price and its impact on economy
We saw this morning a good thought-provoking video about the importance of oil prices to our economy, and the ineluctability of drastic changes as the price of a barrel goes over 100 dollars for good.
The orator is Jeff Rubin, former chief economist at ICBC. His wikipedia bio is here.
The first part explaining why the rising oil prices have triggered the recession is not the best, but keep listening to the part where he first predicts a sustained (and rapid) increase in oil price to triple digits, and then explains the impact on our economic model.
The issue of peak oil has been shadowed in the past two years by the recession, and by global warming. It is a healthy reminder that for a while we are dependant on oil as a source of energy, and if indeed the demand-supply equation drives prices up, we have fundamental adjustments to make to our societies.
A couple examples of these adjustments mentionned in the video :
– the US government should have invested money into public transportation instead of bailing out GM.
– industries will have to be localized again, as transportation costs will no longer be incidentals.
Here is the link – enjoy !
Video of Jeff Rubin on the triple digit oil prices and the impact on economy
Wikileaks, good bad or indifferent ?
About a month back when the wikileaks disclosures began, we had a discussion with Aouda on wikileaks : was it right to divulge state secrets, including some that could give information to terrorists ?
As a business professional, my first reaction was to disagree. Even with the highest desire for openness and inclusiveness, we all know that we cannot always tell the naked truth. It could be misinterpreted, or used against the interests of the business. Or it could be that some things are just speculations, “what-if” scenarios that won’t end up being implemented, so why create anxiety or disruptions by communicating them ?
Aouda was reacting instead out of principles, and thought that the transparency brought about by wikileaks was a fantastic innovation.
Why did I personally change my mind on the matter and become an advocate of wikileaks ? I guess it boils down to some moral aspirations, coupled with some dose of cynicism and realism.
From a young age I’ve always dreamt of a world where the weak would be protected from the brute. This meant there had to be a way to immediately alert everyone to injustices being committed. That’s where the internet changes everything. Where it took a Zola to defend a Dreyfus, anyone today with a blog can draw the attention to events happening on the other side of the earth. See what just happened in Tunisia, where one of the most repressive police states could not hide the death of demonstrators.
So internet, and wikileaks, is probably the kind of “alert system” I was hoping for !
Beyond childhood dreams and naive aspirations, transparency could well be to public policies what democracy is to political systems. Churchill famously said that “Many forms of Government have been tried and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time.”.
Similarly, transparency will create privacy issues, will stir unwarranted troubles, but will on balance better than anything else drive fair play, honesty and justice.
Just my 2 cents here, so if you want to dig further, i found on this great french blog by Francis Pisani (http://pisani.blog.lemonde.fr/ Click here to follow) the following links to articles in english. Enjoy !
“Government should be transparent by default , secret by necessity.”
And the final word goes to Joseph Pulitzer himself : “There is not a crime, there is not a dodge, there is not a trick, there is not a swindle, there is not a vice which does not live by secrecy.”