From the Edge, and their annual “World Question Center” for 2009.
What will change everything? What game changing scientific ideas and developments do you expect to live to see?
Many thoughtful answers, including a particularly good one about climate, likening potential abrupt state changes to unpredictably soundly sleeping giants that we do not want to awaken:
Unfortunately, we are discovering more giants that are probably lighter sleepers than the thermohaline circulation (THC). Seven others — all of them potential game-changers — are now under scrutiny: (1) the disappearance of summer sea-ice over the Arctic Ocean, (2) increased melting and glacier flow of the Greenland ice sheet, (3) “unsticking” of the frozen West Antarctic Ice Sheet from its bed, (4) rapid die-back of Amazon forests, (5) disruption of the Indian Monsoon, (6) release of methane, an even more potent greenhouse gas than carbon dioxide, from thawing frozen soils, and (7) a shift to a permanent El Niño-like state. Like the THC, should any of these occur there would be profound ramifications — like our food production, the extinction and expansion of species, and the inundation of coastal cities.
We’re wallowing in the fat tails.
A relatively thoughtful piece from The New York Times Magazine on the risk metrics used by Wall Street, especially the now notorious Value at Risk (VaR). However, it still seems like neither the author nor the risk managers they interviewed really get what Taleb is saying. Or possibly they’re just not willing to admit the implications of what he’s saying: that market outcomes, especially when investing is focused on the short term, are dominated by so-called “rare” events. And that the consequence (as one of the managers even says outright), is that a lot of the investment banks don’t really have a business model.
Except, of course, for the fact that they can count on the public coffers if they all arrange to go bankrupt simultaneously. Better, in this case, to fail in a conventional way along with everyone else, and be bailed out, than to play your own game for the long term, like Warren Buffet, and either succeed unconventionally, or have to take responsibility for your own failures, which are then likely not to take place at the same time industry wide.
We’re playing the same game of fat-tails chicken with Earth’s climate, and that story will eventually have the same ending if we are unable to generalize the lessons of this relatively innocuous financial disaster.
To plan long term we need time lapse eyes. We need to sense the world on geologic and evolutionary timescales. This is outside of our visceral experience. Astronomers and biologists and geologists get some sense of deep time, but it’s still not an experience. We need to build these eyes for ourselves.
Implementing a national energy efficiency portfolio standard (EEPS) are just as important as, if not more important than renewable portfolio standards (RPS), and will go a long way toward making aggressive RPSs attainable, but aren’t getting much in the way of mindshare. More info from the DoE, and the American Council for an Energy Efficient Economy (ACEEE). EEPS are also a much cheaper (i.e. more profitable) way to cut carbon than current renewables.
I first came across Thomas PM Barnett via his TED talk last year. He’s an engaging speaker (PowerPoint performance artist might be more accurate), and he has interesting ideas about how globalization works, and what the US military’s role has been, is, and should be. I’ve followed his blog on and off ever since. I’m fascinated with him because a huge amount of what he says rings true, and unusually frank, but a little bit of it seems jarring. Last night I watched his full-length brief and took notes, to try and figure out what exactly it was that I disagree with.
Continue reading Barnett’s Department of Everything Else
The SEC will soon require machine readable reporting of all financial data, using an XML based markup language known as XRBL (the eXtensible Business Reporting Language). Holy crap. Yes, this could have been done a decade ago in theory, but apparently it takes some serious mess to get anyone thinking at the SEC. Probably bad for Morningstar‘s financial-data-silo business model, but good for just about everyone else. Will spur a lot of financial transparency, as machines can be easily utilized to find patterns and irregularities in corporate and mutual fund reports, in near real time. I don’t think most people give this kind of development the credit it deserves. Long term, machine readability of all law and legal requirements will change the face of regulation, democracy, and ultimately, law itself.
Trying to keep track of all the shenanigans innovation going on at the Federal Reserve is difficult. Econbrowser and Interfluidity among others have been trying to help… but every time I read about how our money system works, I find my head spinning in incredulity. And that’s just when I’m reading about how it’s “supposed” to work. It’s been getting more confusing lately.
Continue reading What is the Fed doing?
Change.org is a kind of public idea tourament. There are a bunch of different subsections: agricultural policy, government reform, energy, etc. Readers vote and comment on the ideas, and the top few ideas in each category advance to the next round. Larry Lessig has submitted Citizen Funding of Congressional Elections whereby only public money and small contributions can be applied toward election campaigns.
Not sure how well this kind of system can work. Many of the highest rated ideas don’t sound very productive…
California officials launch ‘Green Chemistry’ initiative – Los Angeles Times.
The idea is certainly good, but there’s a lot of bookkeeping that will need be done within the myriad supply chains that create the products, that isn’t getting done now. Does California have enough clout to force it to be done? Seems unlikely (even if we are the Nth largest economy on earth, where N is small). Really we need to partner with the EU, and other like-minded bodies to come up with a single standard we can all adhere to. This is the kind of thing the WTO should (for instance) be about.
It currently appears likely that the “stimulus” package to be passed as soon as congress reconvenes will dump tens or hundreds of billions of dollars into the budgets of the state transportation departments, because they’re the ones with “shovels in the ground” ready projects capable of mindlessly absorbing that much cash. The problem is, those projects are all about cars, and the feds have virtually no oversight of where the money goes once it’s in the state DoT coffers. This is a recipe for waste, not forward looking investment. It is the worst of spending, for spending’s sake – which is what the “stimulus” is all about, let’s be clear – but if we’re going to spend for the sake of spending, why oh why can’t we also do it in a thoughtful way? Because when there’s a crisis, it’s the ideas that are laying around, most accessible, that get implemented. The plans that are on the books, ready to go. The wishlists of those in power.
Continue reading No More Roads to Nowhere