If the U.S. had 21st Century Elections

One may think that the 2020 election was rigged or not.  But one thing is clear.  It is still being run with 19th Century procedures.  The uncertainty, the claims of fraud in voting and/or counting are all the result of the use of antiquated data integrity methods.  How should the election be run?  Well, I'll tell you. 

Registration should be made by appearing at an official state office and providing proof of identity, proof of eligibility to vote and proof of address.  Once this is done an account is opened in your name where you will choose a e-mail address and password.  This website and account is where you will vote.  We already know how to secure this.  If I log into Netflix on a different interface, I will get a notice on my e-mail.  If I change my password, I will get a notice.  In other words, I may get hacked, but they really can't keep me from knowing.

Next, varying by state, I will be notified that voting is open.  This may be a week or two before the election date.  I can make my selections immediately and I can change them as I wish up to the 'polls closed' date and time.  Every time I save a change, I will receive an e-mail to inform me.  At any time, I can save a copy to my computer, date stamped.  Sensible people, right before the 'polls close' date and time, will go in, verify the integrity of their ballot, freeze it and save a certified copy.  

This will also, automatically, be sent, with a coded identity to each campaign office.  The purpose of this is that the official vote totals should agree with the copies received by the various campaigns.  If they do not, anonymous tracing of differences will find the causes of discrepancy.  The State election offices will have a conversion table, coded identity to e-mail, so that individuals with a discrepancy will be notified with official vote that they can compare to their saved and certified vote.

Through this process, vote count error can be reduced to zero.  However, given the process, the discrepancies should be close to zero.

Now, one of the things that is constantly brought up by Democrats is that the process is too burdensome for the lower income people.  Actually, that is a disingenuous argument because even homeless people usually have a cheap smart phone.  SNAP and Medicaid recipients get cell service for free.  Basic burner smart phones can be purchased for $10.  Just the same, every official state office or agency can and should have the facility to update a person's account for them.  It is a red herring argument and should be ignored.

I'm sure that data security experts can improve upon this.  After all, it is just off the top of my head and I am not a data security expert.  What I know is that my bank gives me very secure data and update capability already.  Vote integrity is fundamentally an easier process.

I am on a path to renouncing my U.S. citizenship and in anticipation, I do not participate in voting through a U.S. Embassy.  This is more a matter of the U.S. being a laughing stock as it condemns the election quality of other countries while it clearly cannot assure its own.

Pareto v Price

What a depressing situation, if Price's Law is correct.  Pareto is bad, but Price's Law is worse.  And the larger the organization, the worse it gets.

Suppose GDP per capita is 100,000.  If we have 90,000 people, GDP is 9,000,000,000.  Price's Law says that 300 people will create $4,500,000,000 of that or $15,000,000 each.  The other 89,700 create the other $4,500,000,000 or $50,167.  That means that the elites are just 0.3% of the population and they earn 299X more than the average people.  Now, suppose that GDP per capita is the same, but the population is increased to 9,000,000.  Now Price's Law says that 3,000 people will create $450,000,000,000 or about $150,000,000 each.  They will be .03% of the population and they will earn 2,990X the hoi polloi.

So, IF Price's Law is correct, the larger the population, the more inequality.  However, if Pareto is a better model, it is not anywhere near as bad.  According to it, 20%^3.1 (0.68%) will create 80%^3.1 = 50%.  0.68% is much more than 0.03%.  So, as bad as Pareto might be, Price's Law is much, much worse.  Fortunately, the actual data doesn't seem to support Price's Law.  In 2017 the top 1% of Americans owned 38.5% of the wealth.  In other words, it was actually slightly more equal than Pareto and far more equal than the Price's Law prediction. 

Also, Price's Law suggests that the percent of high producers falls precipitously with increases in organizational size without explaining why that would happen.  Suppose you have 100 groups with 90,000 people each.  Each group has 89,700 people averaging the lower, $50,167 income.  In total there are 8,970,000.  However, if we smash them all together into one group, there are now 8,997,000 people earning $50,167.  There is no explanation of the mechanism by which 27,000 people became unproductive simply by virtue of the organizational merger.

Either way, the clear inequality of income and wealth in free societies is not the result of oppression.  It is simply a reflection of the fact that most people are really not very productive.  Also, many people, likely Jordan Peterson who uses Price's Law, will wonder why I use the .2^X and .8^X Pareto equation.  It is simply because Price's Law leads to conclusions that are not supported by the evidence.  The evidence supports the notion of two components to wealth and income inequality.  One a linear equation that describes mechanical productivity and is usually measured by per hour compensation and the other is the exponential Pareto distribution which governs the more intangible value added.

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Art Laffer and the Welfare State

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Art Laffer, of late, has been saying something that is really profound.  I have heard him say it three times on three different outlets.  It goes like this.  When you take money away from a person who earned it and give it to a person who didn't, you disincentivize the producer by decreasing his reward for producing, but you also disincentivize the recipient who now does not need to produce as much to acquire the same purchasing power.  This, very succinctly, explains why socialism, or more precisely, welfare states have lower GDP/capita and thus lower standards of living.

As we can see by the above chart, the U.S. has had higher GDP per capita (PPP) than the EU for the reported time period.  However, the gap has been increasing.  Without a doubt, some of this is the result of adding low GDP nations in Eastern Europe to the EU.  However, the discrepancy exists with Western European nations, albeit at a lower percentage, as well.  The question is, why would this be?  The reason is almost surely that EU countries spend 45.8% of GDP on government and the U.S. spends only about 37.8%.  When we look at the details, the EU spends 1.9% of GDP less on defense than the U.S. but substantially more on social welfare programs, national health care being the major component.

Art Laffer, despite not inventing it, is generally considered to be the father of the Laffer Curve and, as such, one of the primary proponents of Reagan's Supply Side Economics.  While it was often referred to as 'trickle down economics' or 'voodoo economics', it is, actually, solid Economic theory and a major component of the Reagan revolution.

Basically, the Laffer Curve notes that lower taxes generally stimulates economic growth and higher taxes leads not only to lower growth but also increased tax avoidance.  His claim was that at very low tax rates, while economic growth is high and tax avoidance is low, the lower tax rates result in lower tax revenues.  As tax rates increase, economic growth is less and tax avoidance is greater, but the increase in tax rates in an increase in total tax revenues.  At some point, the depression of economic growth and increase in tax avoidance will swamp the increased revenue from increased tax rates and total tax revenue will fall.

This is good Economics and really not very controversial.  However, Laffer went on to claim that the tax rates at the time Reagan took office were to the right of the mode of the curve and by lowering tax rates, tax revenues would actually increase.  That was very controversial, but despite that, tax rates were lowered, the economic growth rate did increase and tax revenue also increased.  While the Laffer Curve is solid, there really is no good way to determine on which side of the mode a country is at present.

Over time, Art Laffer will undoubtedly be recognized as one of the most influential Economists of the late 20th and early 21st Centuries.  However, he will not win the Nobel or other major awards for Economists because he argues for lower taxes and supply side economic policies in an era of high taxes and demand side economics.  In essence, he argued for an effective decrease of total transfer payments and in the political environment of the time, this was anathema.  However, his arguments are powerful and they did (and still do) diffuse into the collective intellectual consciousness and modify policy to some degree.

As to the divide between Supply Side and Demand Side Economics, it is a politically driven false dichotomy or what Greg Gutfeld calls 'The Prison of Two Ideas'.  Clearly, economic growth requires producers to produce more (Supply Side) or there is nothing more to buy.  However, consumers need to have more purchasing power (Demand Side) or they will not be able to afford additional consumption.  Rather than arguing that one is better than the other, a rational argument is that the two must be in balance.  In other words, while fiscal and monetary policy stimulate greater supply, it must also stimulate greater demand in the same measure.

In other words, I am divorcing myself from Dr. Laffer's political argument while I simultaneously recognize the contribution he has made to our understanding of the relationship between economic growth and social welfare policies.  I am also not arguing that because increasing social welfare expenditures lowers economic growth, society should lower social welfare spending - at least not directly.  There are both economic and philosophical arguments that militate for social welfare expenditures.

GDP and GDP per capita are convenient and important measures of economic well being.  However, they are not the only ones.  While the Pareto distribution assures that income and wealth equality are not possible without creating disastrous economic problems, excessive inequality is politically destabilizing and can result in excessive poverty rates.  Also, because high income people generally save more than low income people, changing income distribution can change the relationship between demand and supply, either causing inflation or slowing economic growth.  A potential result can be depressing purchasing power among consumers while increasing the value of securities without increasing their intrinsic value.

However, one can also argue for reduced income inequality as a necessary consequence of Social Contract theory.  In other words, by agreeing to the Social Contract, a citizen can reasonably expect that a full faith effort in productivity should result in sufficient income to enjoy a modest, but dignified lifestyle.  To a degree, I make this argument in 'An Information Age Income Model'.

It is not unreasonable to suppose that a wealthy society may want to guarantee some subset of Maslow's two lowest levels.  A reasonable set would be food, shelter and health and one that is embraced by most of Europe.  However, considering the disincentives discussed above, it is almost surely unwise to provide them free of charge to everyone rather than only to those who are truly in need of assistance in order to procure them.  To assure these without creating too much of Dr. Laffer's disincentives is not a simple task.  One could argue, as I do, that no nation is doing it well.   

A Practical Man Ponders Schrodinger

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A practical man walks into a room full of theoretical men who are deeply pitched in argument.  There is a box, with its door open and there is a dead cat. The practical man walks up and asks, 'What are you guys arguing about?  Who killed the cat?'

One of the theoretical men answered, 'No, we know how the cat died.  It was in a box, a piece of radioactive material emitted a particle that triggered a hammer that broke a bottle of cyanide gas which killed the cat'.

'Well, that is pretty straightforward, if a bit odd' answered the practical man, 'So what is the argument about?'

'Well', the theoretical man continued, 'We differ on what happened to the alive cat'.

'Wait', said the practical man, 'There were two cats in the box?  And one is missing?'

'No, there was only one cat.  But we have a mathematical equation that says before we opened the door, the cat was simultaneously dead and alive.' replied the theoretical man.

Very skeptically, the practical man asked, 'So, you observed the cat simultaneously dead and alive?'

'No', replied the intellectual man, 'the equation strictly forbids that.  If we try to look at it, it instantaneously is all dead or all alive'.

'So, you are just trusting the equation that it is true, even though you can never see it?' the practical man asked.

'Yes, that is the situation' the intellectual man assured him.

'OK, it seems to me that the cat was half alive and half dead and when the door was opened, as odd as it sounds, the half that was alive become dead and voila' one whole dead cat.'  the practical man opined.

'Well, that was what the original interpretation was.  A cat that was both alive and dead collapsed into one dead cat'.  the theoretical man said, 'For mathematical reasons they say it that way, but basically they agree with you.'

'Then, what is the argument about?' the practical man asked.

'Recently, more and more theoretical men are arguing that when the door was opened, there became a universe where we opened the door and the cat was alive' the theoretical man answered.

The practical man pondered that for awhile and then asked, 'Where is this other universe?'

The theoretical man answered, 'Nowhere that we can ever locate.  That is a requirement of the equation.  No part of this universe can ever interact with any part of the other universe.'

'OK.  Let's see if I got this.  You are arguing that the cat inside the box was both dead and alive though you can never see that.  And when you opened the box, a second universe formed for the alive cat, though you can never see that, either', asked the practical man.

The theoretical man verified, 'Yes, you have the basic principle down.  Though there is an argument that both universes existed and rather than a new universe being formed, the alive cat universe became closed off to us.'

The practical man, obviously getting disdainful, challenged, 'And, before the cat became both dead and alive, was there a dead cat universe and an alive cat universe?'

The theoretical man answered, 'We don't think so.'

'OK,' the practical man replied, 'it seems to me that there was just an alive cat universe until you put the cat in the box and it became simultaneously alive and dead.  The cat then needed a universe to be alive in and a universe to be dead in.'

'Well, that seems reasonable.  Though, I'm not sure anyone has ever thought about it that way' pondered the theoretical man.

'Why would anyone subscribe to this exploding number of universes theory?' asked the practical man

'Because they think it is easier', answered the theoretical man, 'However, they would say that the universe is a huge mass of these kinds of events and that, being the way we are, we are constantly limiting ourselves to one of them.'

'Wait, are you saying that in a totally inaccessible part of the universe, there is another me discussing with another you where the DEAD cat went?'  the practical man asked incredulously.

The theoretical man chuckled and answered, 'As I understand it, yes'.

The practical man, after pondering for a minute or two, answered, 'Look it, it seems to me that the choice is between a hypothetical cat disappearing and a real cat hopping over to the next universe over.  The hypothetical cat seems like the lesser of two evils'.

The practical man continued, 'Now, suppose I am going to flip a coin.  But, I flip it into a box so that I don't know if it came up heads or tails.  Are you saying that until I look inside the box, the coin is both heads and tails, simultaneously?'
The theoretical man replied, 'Well, that kind of depends upon whether your coin flip was a quantum event.  If so, then, yes, in theory, the coin was in superposition, both heads and tails simultaneously.  If not, well, then it was either heads or tails'.

The practical man stared at the theoretical man, dumbfounded, 'Are you listening to yourself?'

'OK', he continued, 'let's go back to the cat.  Suppose we put one more thing into the box - a remote camera.  You and your other theoretical friends are in this room doing your experiment and I am in the next room with a monitor connected to the camera.  Now, suppose I turn on the monitor, before you open the door.  Am I going to see a dead cat or a simultaneously alive and dead cat?  And, either way, how does the cat or the universe or whatever controls this know whether I've turned on the monitor or not?'

The theoretical man chucked and replied, 'Well, that is called the measurement problem.  We aren't quite sure what constitutes an observation that will cause the cat to stop being simultaneously dead and alive and choose one or the other.  Or, alternatively, branch into two universes'.

The practical man is clearly becoming frustrated, 'It seems to me that you theoretical guys went off the rails earlier on, when you decided that your equation describes the actual universe.  Let's go back to the coin flip.  I can write an equation, (1/2H + 1/2T)=1 that describes the probability of the flip, assuming that no cheating is going on.  It doesn't describe the universe after I flip the coin but before I look into the box.  It describes my expectations of what I am going to see.  Now, if I look into the box I am going to see either heads or tails and I'm not going to ask myself, if it is heads, what happened to the tails coin.  Or imagine that a second universe exists where I observed tails.'

The theoretical man, shaking his head, replied, 'No, that doesn't work.  Because we have set up experiments that tested whether a particle was here or it was there and the results indicate that it was in both places simultaneously.'

The practical man looked shocked, 'How could that be?'

The theoretical man replied, 'Precisely.  That is what caused one of the founders of this theory to say that if it doesn't shock you, you don't understand it yet.  The problem is that this indeterminacy that exists at the particle level may have effects on larger scales.  Our simultaneously alive and dead cat is an example.'

After some pondering, the practical man responded, 'Well, I know that I am a practical man and not a theoretical man, but if what you say is true, it seems that reality must, in some sense, not be real.  Because, whether electrons or cats, the notion of things being simultaneously X and not X is not compatible with reality as I understand it.'

Nodding, the theoretical man replied, 'Exactly!  In fact fifty years ago, a Physicist proved that phenomena such as this simultaneously alive and dead cat force us into one of three conclusions, all of which are profoundly disturbing.  One way or another, they all call into question what we consider to be reality'.

With a huge sigh, the practical man said, 'Then, OK, I can live with that.  My world does not have simultaneously alive and dead cats.  You tell me that I can't ever observe such a cat.  So, my world behaves as if it is real.  Since I am a practical man, I can continue to behave as if the world is real while simultaneously accepting that, on some level it is not.  I may have trouble with simultaneously alive and dead cats, but I don't really have trouble with a simultaneously real and unreal universe as long as the unreal one doesn't affect my observed universe.  For all practical purposes, the unreal universe is theoretical.  Right?'

"Not entirely', replied the theoretical man, 'but that would require me to get into quantum tunneling or something similar.  While nobody will ever observe a simultaneously dead and alive cat, we do observe, for example, electrons being places that they should not be able to be and that can affect how computers behave.'

'Same equation?', asked the practical man?

'Pretty much.  A related one', the theoretical man agreed.

'Well, OK, then,' the practical man said with finality, 'I'll take my counsel from Scarlett O'Hara and I'll think about this tomorrow.  And, as we all know, practically speaking, tomorrow never comes.' 

Revisiting Monty Hall

I was introduced to the Monty Hall problem at a Mensa meeting by Cyd Bergdorf, the then head of TNS and Ron Hoeflin.  The problem goes like this.  

"Suppose you're on a game show, and you're given the choice of three doors: Behind one door is a car; behind the others, goats. You pick a door, say No. 1, and the host, who knows what's behind the doors, opens another door, say No. 3, which has a goat. He then says to you, "Do you want to pick door No. 2?" Is it to your advantage to switch your choice?"

The problem is trivial and I said immediately, 'You switch, of course'.  However, then I added, 'it is irrelevant whether the host knows what is behind the doors'.  This is a statement that has not been agreed with by some of the smartest people in the world.  In a private message with Garth Zietsman and Rick Rosner, I found I could convince neither of them of my assertion.  In a way that is good, because it required me to work very hard at creating a proof for what I saw as obvious, but difficult to express convincingly.

The argument for its necessity goes like this.  If the host knows what is behind each door (and as Rick correctly pointed out wasn't inclined to thwart your attempt to win a car), by opening a door with a goat behind it, the host has inserted information.  Essentially he has collapsed the Bayesian prior and changed the probability to 50% that there is a car behind the unchosen and unopened door.  The Wikipedia article does a pretty good job of explaining this if you aren't unfamiliar with the problem.

If the problem said that you were going to play the game 100 times and asked what strategy would be best, then whether the host knew what was behind the doors would be relevant.  Either, in that sequence of 100 games, the host would or would not open doors with cars behind them based upon whether he knew what was behind the doors and was inclined to open only goat doors.  Again, Rick made the very correct point that it matters what was done in the cases when the host did open a car door, if we are in the scenario where that can happen.

But, of course, that is not the problem as stated.  One is presented with a unique event and, as such, the problem surfaces one of the peculiarities of probability.  I recognized this when I was about 8 and I started asking people, 'what is the probability that, if I flip a coin, it will land on heads?'  Everyone, of course, answered 50%.  I then replied, 'It is not.  It is either 0% or 100%'.  To my amazement, nobody 'got it'.  In essence, you really can't average one event.  The Monty Hall problem is of that type.  It is played once.

PROOF:
Consider two sets.  One is a set of n games where the host always opens a goat door.  In the other set of n games, the host opens a car door 1/3 of the time.  In the first set of n games, switching will win a car 1/2 of the time and staying with the door first chosen will win a car 1/3 of the time. One should switch.  In the second set, one will win a car 1/3 of the time if one switches or if one stays with the door first chosen.

Here is the key.  The result is not dependent upon the value of n.  If each set contains 100 games, it will be 1/3 and 1/2 for the goat door only set and 1/2 and 1/2 for the goat and car door set.  If n=200, it will be the same.  If it is 50 it is the same.  In the first set, one should switch and in the second, it doesn't matter.

Also, we will note that in the first set, it doesn't matter if the host is opening only goat doors by happenstance or by artifice.  One can argue, convincingly, that if the host opens only goat doors 100 times and never opens a car door, he almost certainly knows what is behind the doors.  However, whether he knows or just got insanely lucky doesn't matter.  The answer is based upon the elements in the set, not why the elements are as they are.

In the problem, as stated, n=1 and it belongs to the set where only goat doors are opened.  In that set, one should switch doors.  As we see, it doesn't matter whether a goat door was opened because of chance or because the host knew it was a goat door.

I invite questions or refutations.