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Thursday, 26 March 2015

An Unfair World Begs Charity?

Charitable acts are a good thing, right? Er, well, I'm not so keen on just going out and agreeing with that right off the bat. Bad Harry! Charity must be inherently good, right? Well, we can see, in some sense, that charity is a way of correcting the unfairness of the world. So, I guess, the logical place to start is with whether or not that premise is true. We can then talk about whether or not charity is actually a way of solving that issue. In this sense, this post will have two parts. One, is the world unfair? Two, does charity help correct that, solve the aspects that are problematic? Also, play a drinking game. Donate one water pump for every time I use the phrase "some people".

Part The First: Unfairness

Some people consider unfairness in the world to be in evidence when we see companies like Virgin earn more in revenue than some countries do in terms of GDP. Is this actually a case of unfair? Well, to my mind, it is not particularly unusual for companies to have revenues larger than countries. This is because these are quite different things and, frequently, because they are drawn from a much larger pool (Virgin, for instance, has a pretty global reach whereas countries are more constrained... particularly when it comes to GDP which only measures products produced within a country and ignores, for a variety of reasons, a lot of things that affect the point of GDP... i.e. standard of living). For instance, Wiki has Apple Inc. at $183 billion versus a 2012 PPP US$ 122 billion GDP for NZ. Exactly the same thing you're pointing out but because it's NZ it creates an entirely different picture. My point, for those who want it more explicitly, is really that this is just a thing.

Speaking of GDP another way of considering unfairness is the fact that some countries have very high GDPs per capita and others, frankly, do not. When we're thinking about this one it is worth bearing in mind that averaged figures are something to be extremely wary of as they are distorted by extreme values and very few people are actually accurately described by a mean value. For instance, you do a test and the mean score is 62/100. How many people actually got that? The point of that example is something to bear in mind with GDP per capita figures as well. You get distortion (think skew and outliers) and the failure to capture the distribution (to the extent that it's a separate issue to distortion), plus all problems associated with just plain old GDP (see the above paragraph where I nearly mentioned things like its failure to include subsistence farming or black market activities and instead let you dream these up as though you were experiencing some really boring trip). This is, incidentally, an issue with taking some random pointless celebrity (e.g. Paris Hilton or the now more "relevant" Kim Kardashian) and stealing all their money to distribute it evenly among the population of some poor country. What will happen is that you're going to help some people much more than others but you're also quite likely not helping as much as you'd think (because of issues with how GDP is calculated).

What will happen is that you're going to help some people much more than others but you're also quite likely not helping as much as you'd think 

Some also argue that it is unfair that there are people (*cough*KimKardashian*cough*) who are rich and famous for, er, well we're not sure what. What we do know is that they're pretty much what we could call the idle wealthy. Except that wealth, by the way, isn't entirely idle. It's quite possibly not entirely accessible either (i.e. tied in such things as shares and properties that require selling). It's certainly not all being spent (which would be a quite major contribution to wider society, at least wherever it is being spent), which means it is being saved somehow and that means it is largely being invested indirectly (this is how banks make money, by using your money to lend to other people at interest... but that's okay because you don't have to worry about having too much cash, and you may be getting interest yourself). In this sense, our pointless celebrities are theoretically helping improve standards of living just by not having all their money sit in plastic bags in cupboards (or maybe they do that, because, you know, weirdo celebrity crap). I would argue that spending more of these celebrity fortunes (than they do currently) has a more immediate impact and eventually leads to increased saving (and therefore investment, which is absolutely crucial to long term economic growth), but it's not an entirely invalid choice.

As to justifying how that money comes into their hands hands? Don't a lot of them inherit their wealth? Well, surprising as it may seem to some people, many people do give a crap about people other than themselves and would like to improve things for their descendants (see, for a fictional example, the slow paced film known as The Descendants, which has a line that is something like "Have enough money to do something, not enough to do nothing"). Sometimes it is a case of pure selfishness (e.g. how much money is an assessment of your legacy). In either situation, it's pretty clear that people will try to help themselves make more money when they believe that they can get something from it. In more general (i.e. non-inheritance) senses, this is often talked about in terms of innovation and the like. People have no incentive to do anything if they're not going to get something from it (which is why some people, maybe jokingly for this first one, say rent control is the fastest way of destroying cities short of bombing them, taxing people at 100% or making it so everyone earns the same etc are bad ideas). This is also pretty much the principle underlying patents. Note, I don't discuss the other position (again) because I should've been in bed hours ago (got to catch a 7:30am train, yay!).

"Have enough money to do something, not enough to do nothing"

Hmm...  I guess that adds up to one conclusion: the world is unfair and describing it as such is, well, fair. Some places, for a lot of reasons (many historical), are at a disadvantage and don't do so well as others. That's not particularly fair. Some people don't do anything but are wealthy all the same, that is unfair too. All these things in the preceding paragraphs are cases of unfairness. But, at the same time, you see from how I've chosen to discuss them that you (by which I mean we) kind of do need to allow for people to be able to do better than others, we're better off helping the short poppies grow slowly than we are if we try to make all the poppies the same height. Let the first crab escape the bucket and try and develop a way to pull the next one up.

But, at the same time, I hope it's clear that I am not saying that it's okay to accept the world as it is. I don't think that's right. There are a lot of issues in the world today and I've only discussed a few aspects of fairness in the world as we know it. But, I am trying to build towards getting any reader who has stuck with my verbosity and presumed lack of clarity to accept the bigger point that I want this blog to make: one is justified in trying to defend the current approaches that we have.

Party Of Two: Does Charity Help Resolve These Sorts of Issues of Fairness?

Let's start with what I think does help. And we'll start with an unsavoury way of achieving that because it's much easier to imagine actually happening in real life (and when you read it, you'll understand why we have problems growing poppies/teaching crabs how to build ladders). We discussed, earlier, the idea of stealing some celebrities money and just spreading it around. I wasn't keen on this idea (and, apart from the stealing bit, it's not too far removed from charity). If you wanted to fix anything, you'd be much better off installing some strong dictator with a decent life expectancy and the ability to set up a stable state with the mentality to retire and set out a clear way that the system will follow in the future (once our strong dictator has retired). Once you have a system that you can trust, that will be able to back such ideas as "this is the factory that I own and operate" and that is, therefore, able to attract investment and allow people to keep the money that they have, you can actually improve things. For a historical illustration of this principle, it was only a little over a decade ago that we saw the very real advantages that sometimes come from having absolutely terrible people still be in charge.

So, if that's what works and if creating it is easiest through something that isn't particularly easy to achieve (I mean, some people say power corrupts for a reason), does charity also work?  Well, charity is all well and good for people who need it in a specific moment. If you're about to starve to death and some random offers you a famine diet gruel, you're going to take it (hell, you'd probably take a muffin but that might kill you, so don't). That's charity and it's helping someone out, it is being good. However, that act of charity hasn't actually done anything to resolve why you were about to starve to death. In some sense, charity cannot and should never be thought of as an actual solution for anything. In other words, charity is like paracetamol/Panadol: it blocks the symptoms so, hopefully, you can forget about the problem. But does all charity look like this?

Well, charity is all well and good for people who need it in a specific moment.

To be honest, I've got no idea. After all, there are varying ways of doing things and charity is not an exception to that. And like many things with multiple ways to do them, the specific way you choose does have a big impact. I mean, when you're looking at exceptions, a lot of charitable efforts do relate to trying to establish some sort of system (even if one a limited scale). Take, for instance, pretty much any water pump project ever. But this is within one village or surrounding area, it's very restricted in scope. Still, it's a start and it's something that's actually achieve something beyond what is effectively "success at a point". But, you can already see a bigger issue with this limited scope, and that's made quite clear with the following example. If you wanted to help raise literacy rates, building a whole bunch of libraries is a pretty good way of helping to do that. A lot of the time, people are illiterate because they lack access to a textual world. But, this is really assuming that any given library will still be around x-amount-of-time later. That's obviously dependent on bigger picture things like war, environmental conditions (e.g. flooding and droughts, the latter might drive people away from the library's location and the books are pretty much excess dead weight) or what have you and these big picture factors aren't really things that charities will ever be able to have any major influence on. I guess, in some ways, I'm pushing a "pick your battles" and "don't even both trying" message here.

You could argue that helping lots of individuals out and trying to have many points of success is, in some meaningful way, equivalent to not dealing with points of success. You may even be able to generate broader change if you had a great enough density of these success points in terms of time (high density = lots of success points in a short period of time). The problem here, though, is that to do this you need an absolutely massive organisation. It would need a lot of reach in terms of who it draws resources and other support from and also in who it can reach out to. That reach on the helping end would also need some depth... really be able to reach in and address fundamentals in a great many communities (such as water access or shelter)... although because it's through many points of success that depth needs to be even greater. The organisation also needs to be able to monitor the costs involved with this (and with spreading the word). All these costs add up and have further associated costs. These are the problems that some people started discussing more earnestly post Kony 2012... how much of a donation actually goes towards the point and also the wider transparency of the group. The costs are, in fact, such a problem that the likes of Andrew Carnegie often choose to have their bequeaths spent as quickly as possible so that the cost problems are minimised.

Speaking of Carnegie, I'd like to very briefly discuss the relevance of motive. You, as our nearly dead starved person, don't care why the person with the gruel bowl is giving it to you. What you care about is the help. If you think the bowl is poisoned, though?

You, as our nearly dead starved person, don't care why the person with the gruel bowl is giving it to you. 

It sort of follows from this that foreign aid (which is often basically charity) is something that I'm not that keen on. I believe that aiders would be better off taking on more refugees (this could also resolve demographic issues, refugees don't care where they are settled, they are just happy to be safe... short term at least) and that the places the refugees come from are better served not having to stretch their resources over so many people.

So, basically, my conclusion is that the the world is unfair and that this requires some attempts to try and help resolve some aspects of these issues. Further to that, charity is an option that I don't think is usually an appropriate one and, indeed, there is a definitely better alternative (i.e. having some sort of govt. which is able to provide stability, security, infrastructure and the like), although that is not very easy to achieve.

If this has seemed a little, uh, different to usual that's because it was originally written as an OP for a forum I participate in but I've deleted it from there and moved it here because it got very few views and no comments and I decided that means it's obviously sharing the defining features of this blog's posts. And, hey, I just wrote likes for comments. Welcome to narcissistic blogging. The quotes are because I wanted to break it up and I briefly flirted with the idea of submitting it to Craccum.

Saturday, 14 March 2015

Rationale

At some point in time when I was a little younger and a little wider I had to make a decision. Did I choose to do a straight BA? That is, double majors in History and in Economics. Did I choose to do a BA/BSc? That is, a double major in Economics & History in the BA and a major in Maths in the BSc? Or, instead, did I choose to do a BA/BCom? That is, Maths & History (BA) and then Economics (BCom). I chose that last option, but why? Certainly, it's caused me no end of regret (and, in fact, precluded me from eligibility for a scholarship I'd have followed through with applying for). Thus we reach the title, what was my rationale?

The Business School at Auckland Uni would like to tell you that it's trying to build a bridge to a better world. Some first year student I met would tell you that the BCom is basically a joke, assuming you met him before he buggered off overseas to continue studying. The truth is probably somewhere in between. Let's slice the pizza and begin to eat (see, Stats 201 lecturer, I learn stuff).

Business School

In some sense, the Business School is nothing more than a glorified training programme. Economics isn't like that but that's because economics isn't like any of its other disciplines... or maybe it's because my lecturers seem a bit more maverick (perhaps once I get to stage two eco things will look different). But, Business, Infosys, Accounting and Marketing are like this. They make a core assumption: you are here purely to get a job. In all honesty, that's probably true for a great many of their students (and probably every single person who considers doing accounting and/or finance) and, again to be fair, it's something that's important in the context of a system that forces universities to charge international students an arm and a leg as a funding model (can't get the international students if your graduates continually fail to get jobs). It also doesn't help that this is the Business School we're talking about. But, ultimately, the contrast between how my Stats 20x lecturer talks about employment (this is, we used this concept when we did this thing) and the way these lecturers do (when you're applying to firms). I didn't go to uni to be lectured at. I went to uni to attend lectures. I'm not sure if the Business School has noticed, but this is not the same thing. #neverworkedanhonestdayinhislife #lazy

Random First Year

Is the BCom a joke? I don't think so. In fact, the way this dude was talking just screamed both privileged (in the sense that going overseas to study is not the sign of someone from the typical NZ background) and snobbish (in the sense that NZ is not place to study). What I think this dude was doing was confusing the relative absence of the BCom overseas (it's far from being universally offered) with its being worthless. In fact, he may well have been transferring the reputation of the MBA to the BCom. The BCom, to my mind, is the thing one does when one wants to be a professional (hence why there is grounds for the assumption). In some ways, it's either like an LLB (i.e. with respect to accountants) or how to move resources around (i.e. most to all of the other majors) or studying how people move these resources around (i.e. economics). But the BCom lacks the competitive entry nature of the LLB, which lends cred (despite the reputation of lawyers) and studying how people do things tends get a bad rep (i.e. why BA is understood as Bugger All). And then you've got the BSc (fundamentally, I ask, what is the difference between trying to understand one aspect of the world and another?) and engineering (i.e. building stuff), plus all the rest which people tend not to talk about.

Rationale

I am uninterested in accounting. From what I have grasped of finance it seems a little more interesting but it's not really my thing. Elements of marketing and management are interesting. You know what those elements are? How people behave, are categorised and how people think? Motivation and Ethics were probably the Business 101 & 102 units that I found the most interesting. At any rate, this people thing should probably clue you in to where I am interested when I say I do history and economics. So, why do a BCom with a rigid programme of core courses that have to be taken? What could possibly be the point? Well, right now, in some sense, it's because I've already started and when you've borrowed everything pulling out to borrow some more to finish the same thing is stupid. If ditching altogether was an option, not pulling out is the stupid option (see sunk cost fallacy). And that, that right there is why I opted to for the BCom (at least, in part). Not the sunk cost fallacy per se but how I learnt about that, i.e. Infosys 110 (one of the few things I remember). In fact, Infosys 110 was probably one of the better core courses, in hindsight. Deadly boring at first but it has exposed me to some broader ideas to complete the picture. Except, mostly no. I barely remember it, some of the things were interesting (e.g. data versus information) but everything that was more operational or specific wasn't (such as Business Process Modelling).

What I am trying to say, because even with my head a little unclear I can tell I'm rambling, is that I took the BCom because of the core courses that weren't particularly appealing. My younger, wiser self realised that it would be useful, at some point, to have done these things, to have been exposed to these things. Take Accounting. Hopefully we'll get past doing things which are just different ways of thinking about some of the calculations you do in year eleven economics (it's week two) and move into understanding the reports. Because, you know, they're right when they say that the accounting reports aren't just for accountants.

Oh, it's worth mentioning that a number of friends were intending on pursuing BComs helped.

Open All Borders

This house would open all borders.

An interesting moot, no? It's also not one that I would personally like to have to support because I disagree with it. That's not necessarily a disadvantage, but it is when you're dealing with a topic you have an opinion on rather than one you're actively interested in. Why? Because when you take an interest in a topic, you're aware of the wider discussion and arguments around it. As a result, you become aware of both perceived weaknesses in your own position (which you're now opposed to) and you do think through your own reasoning a bit more (which helps with rebuttal). When you don't take an active interest, you're quite possibly dealing with a topic where your opinion comes from your gut: coming up with arguments for the other side requires thinking like someone you're not. That's not necessarily easy, and it makes you glad that debating is a team exercise. But this isn't a debate, it's an almost unread blog... so I'm just going to write a few thoughts about this idea down.

Opening All Borders

I take this to mean complete freedom of movement. In other words, the only thing that would stop me from moving to North Korea, if I had the desire to (which I don't), would be the fact I cannot afford to. In some cases, being able to afford to may not necessarily be a problem. For instance, it's not inconceivable that someone living in North Korea could find odd jobs as they trekked across Asia and into Europe before reaching their end destination (say, the Nou Camp). Alternatively, the dirt poor could construct a ramshackle craft of sorts and hope they reach their destination without drowning (probably unlikely, that they wouldn't drown that is... to an extent, it happens now). But, you get the point: if borders were totally open, only practical constraints would prevent travel from any A to any B.

What would Happen?

Well, we can't be 100% sure but we know that migration is a universal constant in the human experience (and, indeed, it's the only reason why people aren't confined to East Africa, as a species). We also know, broadly, why people migrate. There are push factors (i.e. things like Civil War or famine, those forces that make staying put less desirable than moving elsewhere) and there are pull factors (for instance, the promise of jobs in cities or anything else that draws people in). We also know that some areas of the world are, on the face of it, much more desirable than others (for instance, you'd rather live in NZ than the US and you'd rather live in the US than Pakistan and you'd rather live in Pakistan than Syria... assuming that you are an average human being without any emotional connection to any of these places). We can also see that there are places that are not only relatively less attractive to live but are also just plain unattractive due to conditions within those countries (which arise from all sorts of scenarios, war's a common one).

All up, I think it's fair to say that were people able to move anywhere they wanted, at least in theory (see discussion on constraints), people actually would. This could look like US to NZ travel. That is, movement from one well off country to another well off country, that speaks the same language. These are, furthermore, people who are more likely to be able to afford to move, and they would have the motivations, in many cases. For instance, at uni the other day and American woman described her and her husband's mutual desire to shift here more permanently. In most cases, though, we're probably likely to see people who are looking for major improvements in their quality of life shifting. Migrating isn't a decision one makes on a whim... it involves a lot of costs and a lot of loss. And, then, when you arrive you're often met by the Winston Peters of the world, or worse: i.e. bigots who don't want you around. Many migrants also have to deal with culture and/or language shocks. In some sense, migrants can be classed in two categories. On one hand, you have someone who chooses to move and on the other you have someone who is forced to move.

But, really, the big question is: how many people are we talking about here? Personally, I think that open borders would, because of the above, lead to the first truly global migration of humanity: a migration millions strong. There's another big question: the world's a pretty big place, how will this be distributed? Well, again, I can just make educated guesses. Places surrounded by pretty rough seas that aren't close to anywhere? They'll probably attract only people who can fly in. Places that are closer to anywhere but still have rough seas? They'll attract people who are desperate, as they do now, provided they're desirable places to move to, and they'll probably get a lot more. Places that are connected by land and are desirable? They'll probably get a lot of migrants. In some sense, we'd probably see some form of this:

Net Migration Rates, 2011, from Wikipedia

That is to say, we'll probably see a more extreme version of current trends. Why? Because the same conditions that pull people in and push people out will still exist, at least in the short term.

But, what does that mean?

It is never just enough to have an idea of what would happen: one must know what that actually represents: 3% growth in Real GDP is a what, increased standards of living is, theoretically, a meaning. So, what would this mean?

Infrastructure & Housing

This is the big reason why opening all borders is, for me, a bad idea. By restricting immigration rates, countries are able to avoid sudden population increases that existing infrastructure doesn't have the capacity to handle. Take Auckland. Right now our transport infrastructure is not far from reaching capacity, and has little room to improve due to idiots in Wellington now (i.e. the current govt.) and idiots from all over in the past. If we were to experience a sizeable population increase this would be extremely problematic. The simple reality is, that when the demands placed on infrastructure and housing exceed their capacity people will be worse off. Sewage, water, electricity, transport networks etc. etc. will all be unable to cope. We'll also have too many people floating around, many of whom will be unable to move on. We'll, in short, probably have something like this happen:

Photo / Leon Woods / Flame Pig; taken from the NZ Herald website
Note, I'm not sure what happened to all the concrete in that part of Domain, but you get the idea and I am rather lucky that I stumbled across the Herald's piece on a World Vision humanitarian campaign, in hindsight. This is, of course, the reality that many people under our scenario are trying to get away from. It's possibly a bit extreme but there's nothing good from placing huge demands on a system that won't be able to change in the short run.

Further note, if you don't have a permanent home there isn't too much difference between not having a permanent home but having some means of getting to another country and being in that other country and not having a permanent home. The question such a situation would force one to confront is whether or not being in the other country is a better place to be of no fixed abode than the one one is in.

Security

I'll be brief here. Being able to control who comes into a country, even there are flaws with the system (i.e. absence of total control), means that the vast majority of people who enter a country do so with a) permission and b) oversight. If anyone can enter the country there are only practical reasons ensuring that people enter in a manner that can be monitored. I just can't reconcile the concept of "open borders" with any method of monitoring who comes in. I don't understand any rationale for that and, as such, see it as actually being entirely arbitrary. Maybe there are models of open borders that would allow this, but with the conception I outlined earlier? That can't work here... the dude that washed up on that beach has as much right to be in a place as that dude who came through three "random" bomb checks at the airport. You get the picture. It also make it difficult to extradite anyone...

Social Opinion

Yes, it's not right that bigots should decided whether or not a country pursues a particular policy but it is worth pointing out that any animosity towards immigrants that exists now, will only get worse in places that hit capacity.

Net Exporters

Sudden arrivals in large numbers are bad. Sudden departures of large numbers? Also bad. And very difficult to reverse. I mean, for one, think of all the lost tax revenue. For two, think of the dramatic drop in people. That necessarily has to lead to declining demand. Which means what? Yeah, recession.

The Picture

The picture I am trying to build here is one of a world where everywhere and everyone ends up worse off. O mean, the countries where people will mostly want to move, won't exist in the form that we know today as a result of substantial, rapid population increase. The places that experience significant declines in population won't get better either. In fact, they'd just get worse. And they'd get worse in a way that makes correcting their current problems even harder. In the short run, from a utilitarian perspective or doing the most good and minimising harm, open borders are terrible. From a moral perspective, I'd argue the same thing.

Wait...

A clever reader may have noticed that I used the term "short run" a couple of times in this post. And there's a reason for that. I think, personally, that globally open borders would be extremely rough in the short term. In the long term? Well, there's room for hope. All the new people create more demand. Initially, that's bad. We saw that with the infrastructure piece but more demand increases the demand for jobs (which is why it is known as derived demand for labour). Provided that immigrants arrived and had some means of spending, this would happen. In some sense, then, we could expect, after at least a few terrible years, some sort of equilibrium establishing itself. The flow of people leaving would eventually reach a reasonably constant rate* (and constant means that you can allow for it), and with more demand and job supply in an economy you could, possibly, bring the world back up, roughly, to where it is now in only a few decades or so. Once you're there? Well, you'd arguably be better off because you'd have free movement. This would make it difficult for oppressive govt.'s to stay in place (because refugees would always be able to end up somewhere else), but, more significantly, you'd have a truer free market of labour out there. Matching needs with people would be easier. In this sense, you see why utilitarianism is a bad idea... the end is better if you choose to open borders but the way you get there just plain sucks.

*And that would happen because even with open borders, there are those practical constraints I mentioned.

To End It

This moot was blatantly lifted from the debate I watched the University of Auckland's Debating Society put on. It was good as a show debate but, personally, the really funny debaters that made previous show debates I've seen, seem to have left. The way I chose to discuss the issue was different to the more moral arguments presented by the affirmative, but reasonably similar to that of the negative. If you ever go to study at Auckland uni, readers, do join us. Very reasonable joining fees and much value for money.

Oh, and yeah. The infrastructure thing is why I am not keen on open borders. To my mind it is a trump card that proponents of open borders cannot overcome... and, in some sense, a moral argument as presented by the affirmative would struggle with the "Net Exporters" section. But, certainly, I do agree with myself when it comes to which option should, theoretically, be better in the long run, and I definitely agree with myself in saying that the ends don't justify the means.