It Recurs to Me...

I'm posting the below content because I'm about to use the Amazon MTurk marketplace to edit my article about...the Amazon MTurk marketplace. It occurs to me that one could actually write a computer program that used the MTurk API and a series of HITs to create content about anything. It would be fun to have a program that wrote a blog. I might do that after tax season. :) Anyway - here is my content:

When Amazon launched its crowd sourcing service in late 2005 it chose the name “Mechanical Turk” (a.k.a. MTurk) because like von Kempelen it uses humans to do what machines cannot. When we talk about human–computer interaction (HCI) we usually think of the computer as the “tool”. But in the world of Amazon’s Mechanical Turk, the human is the tool being used by the computer application.

The service has two types of customers: “requestors” and “workers”. Requestors are people or programs that want to pay for work; workers are people who are willing to work for pay. Requestors create HITs (Human Intelligence Tasks) by using either the web interface or developer tools (API and command line tools) and specifying a title, description, required completion time, reward, and results type. Requestors can optionally require that workers “qualify” by completing boilerplate or customized certification tasks before becoming eligible to work on HITs – this is useful for highly skilled tasks and to filter out weak performers. For example a qualification task could require workers to correctly identify differences in pictures or demonstrate proficiency in written English.

Once created, HITs are published to the Amazon marketplace, where “workers” can browse and accept them, perform the work and submit their results. The requestor then reviews the results, approving or rejecting each completed HIT. Requestors only pay for approved submissions and Amazon takes a 10% additional commission on completed transactions.

I just finished a 5 pager on off-shoring versus on-shoring outsourced IT services. Even though I wrote it, I don't own the rights to it...but you can check it out here and tell me what you think. I have an Excel-based decision making tool linked in the original as well. Comments and feedback are appreciated!

Greece isn't a match about to light a fire. It is a symptom - a plume of smoke. The PIGS are only part of what is smoking. The fire has been burning larger inside the building every year since the developed world began piling on debt in the mid 80s.

Real growth in the developed world was disingenuous over much of this period of time because it was enabled by very low inflation for extended periods of time. This was the result of large-scale outsourcing of both manufacturing and services. Now everything that can be outsourced has, and natural inflation is occurring again. We are seeing lower real growth rates as a result, which has put additional focus on sovereign debt.

Debt is simply at a tipping point for the worlds biggest economies and there are only two paths: inflate out of it or exercise extreme fiscal discipline. Either path has devastating consequences. The economic theory is strong in describing either scenario. At the same time we are tremendously strengthening banking regulations and capital requirements. Although this reduces the risk of "outlier" events, it guarantees slower growth. The combination of debt burden and financial regulation has created a difficult situation.

There is a horrendously painful recession coming and it could be much worse than that. It will be global and last for years. It could take a few months to happen, or a year, or a few years.

Regarding Europe...separate currencies are needed to allow economically weak countries to become competitive. The mechanism by which this occurs is a weakened currency. Either weak states such as PIGS will default on their debt, stop using the euro, and then inflate a local currency...or strong states (Germany) will adopt a local currency and collapse the value of the euro. The euro as a true common currency in Europe is dead.

European political leadership (*cough* Merkel *cough*) is waging a PR war to convince investors that this will not happen because a massive amount of capital will be lost when it does. In my opinion it is inevitable and simply a matter of when. All politics is local and when the heat comes politicians will either do what voters tell them to do, or new politicians will be anointed for this purpose. Stronger nation members of the EU will not accept the economic burden of supporting debt-burdened states.

This one is for Aidan.

Mathematics:Economics = Lotion:Masturbation

It might be fun, but at the end of the day you're not really accomplishing anything.

What Would Occam Do?

If the Tick were asked to comment on the toxic asset repurchase, he would probably say something like this, "For those of you who aren't paying attention, we residents and citizens of the U.S. are about to make a big doo-doo in our diaper of finance."

I understand why injecting liquidity via "toxic asset" purchase may be beneficial. However I anticipate a very large cost of administration and foresee great waste and large missteps in execution.

I believe that there is a much more elegant solution to the banking liquidity crisis. We should temporarily reduce the required reserve ratio, and allow it to slowly climb back over a 3-5 year period.

I believe that India took similar steps last year, to positive effect. This solution immediately adds liquidity. It would cost nothing to taxpayers. It would aid all banks in a fair way, and would not require politicians or bureaucrats to make high-stakes decisions that they did not understand.

For those of you who don't know me, here is a quick background. I am an Economist by education and have worked in this capacity for the IRS, focusing on the analysis of large foreign owned corporations. I have also worked as a tax accountant, and in corporate finance. While this should not make me more qualified to have an opinion than all the "experts", apparently it does.

I would tremendously appreciate responses.

There are two grassy meadows next to each other, hanging out. The first one says, "I think I hear something coming."

Second one says, "Yeah."

First one says, "Look - it is a herd."

A herd of cattle comes tearing through over the second meadow, making a ruckus.

When they are past, the first meadow says, "Hey, are you alright?"

The second meadows replies, "Yeah, they only grazed me."

Fetuses Learn to Play Sports, Bulk Up

I was browsing science news yesterday, when I stumbled upon this gem. It seems that there is company called AmnioTrainer producing “in vivo” sports training products for FETUSES! They don’t have U.S. approval yet and there is a debate about the potential hazards of the products. The company’s current products include AmnioBall Futbol and AmnioShock Strength Trainer.

AmnioBall Futbol measures 1.2 centimeters in diameter when inflated, but is inserted surgically while uninflated. Once in the womb, it is filled with the mother’s amniotic fluid so that the ball does not float or sink. A harmless strain of the E Coli bacteria genetically engineered for bioluminescence gives the ball a faint glow, encouraging the fetus to interact by grasping, punching, and kicking. 3D and 4D ultrasound images and movies posted on the company’s website seem to verify these claims. According to AB, the Futbol product will be available for implantation throughout the U.S. and Europe in mid-2008.

AmnioShock Strength Trainer uses low-current high-voltage technology similar to that used for weight loss and strength training in adults to stimulate fast-twitch muscle fibers, allowing fetuses to develop superior strength and speed without the use of pharmacological agents. The Strength Trainer product will be not be immediately available in the U.S., but is available at several clinics in China and Central America. The delay in primary markets is over concerns that trial data showed a slight increase in pre-term deliveries in the study but not the control group. The “significant but not pronounced” decrease in gestation time should not be a concern, according to the company spokesperson. However, AmnioShock Strength Trainer has provoked strong criticism from a number of groups including Fetal Rights Watch and the Preschool division of the Pan Americas Youth Soccer League.

While AmnioTrainer’s methods are debatable, there seems to be no doubting the results. According to the trial results, which began in Brazil on January 8th, 2005 with 127 second trimester fetuses, the performance of two-year-old children trained with AmnioBall Futbol was on average 12 percentile points higher in kickball and 17 points higher in soccer. Results from AmnioShock were varied but showed an overall average of 34% strength gain across all major muscle groups.

My home is protected by neither Lasers nor Alligators

I was surprised at the magnitude of the resistance to the idea of building a fence on the U.S. border with Mexico. It might be that I skew liberal in my writing and therefore the readers and comments skew left as well. Offhand I’d say that about two thirds of commentators viscerally hate the fence, and a third think it should have automated machine guns and an alligator infested moat.

The predominant anti-fence sentiments are that it would be disrespectful to Mexicans, and that it is unfair to put a fence across the south border and not the north.

After much thought, I have come to the conclusion these comments are just plain stupid. I believe that they are classic examples of knee-jerk herd-minded liberalism that is poisonous to honest intellectual discussion. I imagine a similar flavor to the student communist movements of the mid 20^th century in the developed nations.

We need a fence in the south because there is already a fence in the north. It is called Canada. It is a sparsely populated winter wasteland, inhabited by people that are culturally identical and nearly as wealthy as Americans. There is no superior barrier to illegal immigration than lawfulness and economic equality.

But the massive gradient in wealth, education, and healthcare across the Mexican border absolutely ensures that, absent a hard barrier, large scale and uncontrollable illegal migration will occur continuously. Hundreds of millions of people from Central and South America would prefer to be in the U.S., and it is not in the best interests of Americans to accept this flow of new residents at its naturally occurring rate. The only way to slow it is to create a physical barrier, and to help improve the economies of our neighbors to the south. Improvement to a level sufficient to stem the tides will take many decades. We are left with the current need for a fence.

A nation has the right to determine the sources and pace of immigration. There is absolutely nothing xenophobic about this – it is simply anarchistic to suggest a country should not have the right to make and enforce these decisions.

Likewise, it is intellectually dishonest to compare the southern border to the northern. There is a reason that banks install better security than I have in my house. They have more at risk and a higher probability of incursion.

Dennis Miller said, "What is this 'tat', and how can I get some of it to trade?" In that vein, doesn't the phrase "giving someone lip" sound like it should mean something much more fun than it actually does?

Completely unrelated(ly), my wife thought of the best name ever for a warmongering cat: Hungry Hissinger. Nukes: cats ask for them by name!

Enough comedy for now. I was accepted to write for Damn Interesting a couple of weeks ago. Damn cool site - check it out. Anyway, it takes a lot more time to write for them than it does to blog. I'll try to post here and there, but with 2 kids on the way it is going to be slow going. I have to get off my but and stack up some firewood for the winter too. Or I guess I could always just do what I did last winter: cut/split a few wet pieces at a time and use explosives to get them lit every day. BTW, if you are my insurance agent, I'm just kidding. If you anyone else...seriously. Explosives. Also vegetable oil (in a pinch).

Well, it is 5:30AM and I haven't slept yet. Sorry this post is so short and ditzy. I hope it made you laugh a little.

As Stephen Colbert might say if I was one of his staff writers, “I feel dirty from mucking about in the cottony waters of immigration truthiness.” Before you read this post you might want to go back and read the last two. Or not. Anyway, how do we make it both harder to enter the U.S. illegally and less profitable after illegal entry? Four words: Fence, Enforcement, Fine and Amnesty. Don’t count the ‘and’.

Fence. We make it so that the chance of passing that fence without interception is 9% instead of 90%. If we can do this, it will not make much financial sense to attempt illegal entry. Two chain links separated by sensors and a lot of space. Rapid response teams every few miles. It is totally doable and completely necessary. Arguments that this will increase xenophobia, undermine human rights, or dehumanize latinos or immigrants are specious. Knowing that everyone here came legally will put us all on even footing.

Enforcement. Finding a way to punish employers that hire illegal immigrants is at least as important as making it harder for illegal immigrants to enter the country. Fixing one of these problems without fixing the other will not solve the problem. The fundamental problem in achieving this relates to our previous discussion regarding statutory prohibitions on information sharing between the I.R.S and D.H.S. Also social security numbers are a century old technology that is insanely ineffective. It is time for biometrics, period. This will fix everything. There are obviously privacy issues, but they are solvable by hashing (a non-reversible hash obviously) the biometric data and then encrypting it. The encrypted hash would be passed for verification or embedded on ID cards. If the code was compromised (identity theft), then the citizen could apply for a new hash. Once we have biometric IDs, law enforcement of right to work becomes trivial. If it takes 9 tries to enter the U.S. once successfully, and the average illegal immigrant is caught and deported after a year, it simply will not pay to try to cross the border.

Fine and Amnesty. We’ve talked stick – here is the carrot. The U.S. economy obviously depends on its current illegal workers. Deporting them all, even over a long period of time, would not be in our best interest. This is an understatement…it would cause horrific inflation and would make it difficult for most businesses to operate profitably. Think colossal blunder. So if we can’t remove the current illegal workers, but they got here, well…illegally, then what should we do? Here is my answer.

After Fence and Enforcement are up and running, we publish the following plan and then implement it, making it clear that all steps will be followed:

Step 1: All illegal immigrants must register with the D.H.S. within 12 months. Failure to do so will result in missing the opportunity to apply for a Conversion Visa. There will be no exceptions – if you are an illegal immigrant in the U.S., and you do not register in 12 months you will permanently lose the opportunity to obtain this visa. This will mean certain deportation.

Step 2: Those illegal immigrants registering and passing a criminal background check are issued a Conversion Visa. The terms of the Conversion Visa are as follows:

a. Within 2 years of obtaining a Conversion Visa, the visa holder must return to his or her country for at least a week. The purpose of this element is trust building. If the visa holder does not return within this period, the visa will expire and the holder will be permanently unwelcome.

b. After travel back to the home country and then return to the U.S., the trip will be verified by inspection of the Customs stamp in his/her passport. Upon return to the U.S., the Conversion Visa will become a “Yellow Card”. A Yellow Card confers permanent right to work and residence in much the same way as a “Green Card”, with the following exceptions:

1. Yellow Card holders may apply for U.S. citizenship after a period of 10 years. This long period is in deference to the millions of foreigners that are legally waiting to immigrate to the U.S..

2. Yellow Card holders (even after they obtain U.S. citizenship) permanently forfeit their right to collect Social Security retirement benefits, but they must continue to pay Social Security Tax. However they are eligible for Medicare/Medicaid. The lifetime forfeiture of Social Security benefits is a substantial fine – paid to the U.S. government for having broken the law.

That’s it. Fair compromise, full citizenship eventually. S’up?

PS...A lefty would (did) say (yeah that’s right I’m talking to you Greg Becerra) that making Mexico’s economy stronger will help solve the problem. No. Even if that were to happen the problem would cascade and there would be just as many illegal immigrants coming through Mexico from Guatemala, Honduras, etc. Any weak economy in the world is going to create this problem. To boot, even though Mexico’s economy has gotten much stronger over the past decade the disparity is still huge. According to the CIA world factbook, in 2006 Mexico’s per-capita income is a fourth that of the U.S. 20 years ago in 1987, it was a sixth. The actual numbers for 1987 are $26,668 vs. $4,656 in real 2000 U.S. dollars (reference here). Illegal Immigration from Mexico is at least as large of a problem today as it was 20 years ago. It will continue to be a problem for at least several decades. And that is just Mexico.

The Smartest Compromise Possible in the Ongoing U.S. Illegal Immigration Debate: Part II

This is part two of my last post. There will be at least one more part as well. Here is a quick recap of the liberal and conservative main points in case you didn’t read Part I:

On the right:

1. People should not be rewarded for breaking U.S. law.
2. People who followed the law and are going through the immigration process legally should not be penalized.
3. It is meaningless to discuss amnesty if new workers without visas will flood in after reform.
4. Illegal immigrants do not pay taxes but consume/use costly services and infrastructure.
5. Not having English as a national language spoken by all destabilizes society and divides us.
6. Illegal immigrants repress wages for Americans.
7. Unsecured borders are a real threat to the policing of terrorist threats.

On the left:

1. Not providing a path to citizenship for people who have lived and worked here for a significant time might create a permanent underclass that does not feel ownership in their country. This could undermine our culture and divide us.
2. Expelling a large number of workers in a short period of time could seriously damage the U.S. economy.
3. The current situation is not unprecedented. Historically, the U.S. has had a higher % of immigrants before.
4. Many families may be split up by an aggressive policy of expulsion.
5. Demonizing “illegal” workers may cause racism to worsen.
6. Illegal immigrants largely do the work that U.S. workers are unwilling to do.
7. Children of illegal workers, many born in the U.S., will be greatly harmed by the expulsion of their parents.

I want to start off with Right 4. It turns out that this is factually incorrect. About 75% of illegal immigrants do pay taxes (Income, Social Security, and Medicare). Stephen C. Goss of the Social Security Administration (SSA) has been quoted as saying the SSA puts the number at 75%. Of course this isn’t true of the guy hanging out at Home Depot, but it turns out that most illegal immigrants are actually employees, and when they are hired they present fake or stolen social security cards. As a result they pay in not only Income Tax, but also Social Security and Medicare taxes for benefits that they will probably never collect. If you want to do your own research, check it out. You can actually get direct sources from the SSA on this, but here is a good article here. So anyway, ixnay to Right 4.

Let’s move on to Left 1, Left 5, and Right 5. Point taken. I accept that it is fundamentally un-American to reinvent indentured servitude. The U.S. has the right to decide that illegal immigrants may stay or go, but there must be a path to citizenship for those who stay. However, this leads to Right 1 and Right 2.

It is very hard to disagree with Right 1 and Right 2. Hundreds of millions of people worldwide want to immigrate to America. Even the best of them should wait to enter legally. The U.S. cannot send a signal that coming illegally is superior. There are also millions of already in queue to enter legally, primarily on family visas. I suggest that as a solution, we agree that any path to legal residence and eventually citizenship for those who came illegally must be sufficiently long to ensure that there was no benefit to them for having jumped in line. Based on an examination of the longest average waiting times for family resident visa applications, I would suggest a minimum waiting period of 11 years before a person who is a current illegal immigrant in the U.S. could become a permanent legal resident. In the mean time if they are allowed to stay or to leave and re-enter, it will have to be on a work visa.

A lefty might suggest that this violates Left 1 and Left 5 – but it does not. The average American lives to 77, and 11 years is only 14% of a lifetime. Paying a substantial price for having committed an illegal act will lead current citizens and legal residents to be less angry. In the end, this will lessen xenophobia, not increase it.

I’m going to assume that so far you reasonable lefties and righties are on board so far. In the interest of agreement, let’s throw each other a bone. Left 3 is more or less true. In 1910 14% of the population was immigrant (legal and illegal). In 2005 it was 11%. This fact shouldn’t change policy, but it is good to keep in mind that we aren’t in unprecedented territory here. There was also extraordinary economic growth in the U.S. in the 1910s. We all like that.

On Left 4 and Left 7 however, not so much. Although many illegal immigrants do have children who are U.S. citizens…it is certainly the right of the deported parents to take their children back home with them. Mexico is not Sudan folks. If parents make the decision to leave their children with other caregivers in the U.S., that is their right as well. As responsible parents they will make the decision that is in the best interest of their family. But it is not the responsibility of the U.S. to be force-fed new citizens based on the qualification that they are able to sneak across the border. This demeans the process, the concept of citizenship, and most importantly is horribly unfair to the millions of relatives, students, professionals, and diversity lottery recipients waiting patiently to enter legally. I am sure that on this we can agree. Uh-huh.

But enough agreement – let’s move onto something more polarizing. Good ‘ol Right 3. I cannot see an argument against this one. In fact, recent U.S. history has proven that if we don’t put some real teeth into a reform bill, a wave of new illegal immigrants will rush in to fill the void created by legalizing the current ones. This exact thing happened after 1986, when President Regan signed a sweeping immigration amnesty bill into law. There was no effective enforcement method available of preventing new illegal immigrants rushing in to fill the economic ecological niche vacated by the new amenstees. So rush in they did, and the law was a disaster. Even Fox News says so here.

So fool us once – shame on us. Fool us twice… We can’t make the same mistake again. Not only is there no point talking about comprehensive Immigration reform without enforcement, but it would effectively increase illegal immigration to attempt it. So if we want reform (and we all do), we are going to have to address enforcement in a post-reform world. Okay? Okay.

I want to take Left 6 and Right 6 together because they are both obviously true. However, let’s add some nuance. American workers aren’t unwilling to do these jobs – they are either unwilling to do them at crappy wages, or unwilling to buy expensive machines that do them when illegal labor will do them cheaply. On the other hand, the huge number of migrants that come in legally on farm work visas seems to invalidate the Right 6 argument. No one really whines about farm work visas. Not so much.

Now here is an important point. According to the SSA about 75% of illegal immigrants pay taxes. That means they had to show a Social Security Card to become an employee. Which means they used a fake card with a real number (meaning they stole the number), or just used a fake number. So we can fix this right? No, not really. The IRS is not allowed to share information with the DHS/SSA in a way that is sufficient to determine who is using a fake number. I delved deeply into this issue. The bureaucrats have tried many times to setup an information sharing system that allows employers to check if their new hires are legal or not. Not only have all attempts at creating this system failed horribly, but it is the opinion of most of the people involved that statutory prohibitions on information sharing due to privacy issues make it effectively impossible to fix the problem.

In other words, a social security number is the only way to see if someone is legal, but the government organizations that have the best answers to the “Is he/she legal to work?” question are not allowed to answer the question. And because the quality of the answers from the organizations that *are* permitted to respond is so poor, there is no way to require employers to use the reply at all. The cackef**kedly botched prosecution of Tyson Foods for hiring many illegal immigrants showed this unambiguously. If you read my source here, note the only important sentence: “On March 26, 2003, Tyson Foods was acquitted of all charges in the case brought against them by the U.S. Government.”

So let’s review. As per 1986 – if we have a general amnesty, then we will have an immediate new wave of illegal entrants rushing in. This is because we have no border control.

Our employers don’t know who is legal anyway, because the majority of illegal immigrants use fake or stolen social security numbers and U.S. privacy laws prohibit the IRS and DHS from talking to each other. We could fix this problem with biometric-based ID for all U.S. citizens and residents, but privacy laws prevent that also.

We are f****d guys.

We are not willing to include biometrics in all ID, which is nice because that is an actual solution that would magically disappear the entire problem. So given that we will not do this – all we can do is cut a deal with those who are currently here illegally while at the same time making it harder to get here for new would-be illegal immigrants. And that brings us to Right 7: border security.

Fencing is one of the touchiest subjects in this discussion, and I have no idea why. I have heard equally intelligent, equally well-informed people say, “There has to be a fence” and “A fence is the dumbest thing I’ve ever heard. To solve this one we need to think outside the box a bit. Better yet, we need to build a massive, multilayered, high-tech, roboticized, sensor-laden fence around the box. By the way, Microsoft Word thinks that ‘roboticized’ is a misspelling of “Robotic Zed”. F**k it – let’s hire Robotic Zed to patrol that f***er too.

The fundamental problem is one of economic disparity. A skilled laborer from Mexico can make 3 or 4 times more doing the same work by moving north. That is a heck of an incentive. We here in the North do not want that skilled laborer to come here illegally, but it is clearly in his best interest to do so. There are not many ways to make it less likely that he will come. We can either make it less easy for him to get here, or less profitable for him to be here.

So far I’ve tried to address everyone’s concerns. BJeezus I’m tired. If you feel strongly about something I didn't mention in the Left/Right list, please post a comment. I'll try to address it. Tomorrow I will actually propose a practical solution.