A Reactionary Research Fund

Sadly, ideology has invaded research activities, not surprisingly, with the Social Sciences being the central battle front.  An increasing percentage of funded research is being directed at proving such dubious claims as 'gender is a social construct', 'there are no differences between male and female brains', 'there is no such thing as race, and, even if there were, there are no cognitive differences between them', to name just a few.  Essentially, Academia has become an ideological monolith that assures that its viewpoint is well supported through a process of funding research that is likely to support it and defund research that would likely refute it.  So, herein, I advocate that we create an 'Objectivity Research Fund' whose purpose is to fund research that could challenge the current Progressive paradigm and then to disseminate the findings.  If nothing else, the disruption will be fun.

Recently, knowledge of the general 'greening' of the planet, primarily due to increased atmospheric CO2, but also due to lengthening growing seasons, higher rainfall, etc., has become fairly widespread.  However, the ideologically driven media quickly mobilized with articles such as this one in the NYT, 'Global Greening' Sounds Good. In the Long Run, It's Terrible.  Clearly, it is well established that more CO2, warmer temperatures and higher rainfall leads to more plant growth, which gets eaten by more herbivores, which, in turn, feeds more carnivores.  This is not controversial; it is why greenhouses increase all three.  So, it takes more than a little bit of journalistic legerdemain to turn it into 'terrible'.  

I will briefly review the four points that the article makes to demonstrate just how disengenuous the news coverage is when reporting or commenting upon ideologically charged subject matter.  The first point is that "More photosynthesis does not mean more food".  That is true if we are speaking just about human food.  The point that the vast increase in yield per acre over the last century was not the result of more CO2 in the atmosphere.  It was due to better cultivars, better agricultural practices such as crop rotation.  However, all things being equal, with higher CO2, less land needs to be dedicated to agriculture at the same level of agricultural technology.  In other words, the 'greening' means that Mankind's 'footprint' is smaller.  That is good.  

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The article states that a 30% increase in CO2 does not create a 30% increase in food production.  That is true.  However, a doubling of CO2 does create approximately a 40% increase in food production.  The notion that, because the increases do not correspond precisely, the whole idea of increased CO2 can increase food production can be dismissed is ridiculous.  One can calculate a ratio and estimate that a 2^.5 increase in CO2 will create a 1.4^.5 increase in food production.  An 18.3% increase in food production simply from the increasing CO2 level of 41% is very significant.  By the way, the 41% is close to the amount of CO2 increase expected by 2100.  So, we see that 'reason one' is absent any value whatsoever.

The second claim is that vegetables grown in higher CO2 concentrations can be less nutritious.  That is true to a degree, but it certainly hasn't been brought up with regard to hydroponic vegetables that all are grown at multiples of atmospheric CO2 levels.  The article correctly states that all the reasons why higher CO2 grown plants may be less nutritious are not known.  The word may is critical.  It is not the case that all plants grown at higher CO2 concentrations are less nutritious.  As CO2 levels, temperatures, growing seasons, rainfall change, farmers change cultivars based upon the research done and provided by the seed manufacturers.  In other words, the seed suppliers and farmers naturally compensate for this factor, since they want to bring the best product to market in order to command the highest prices. 

The third item is that the greening of the planet won't stop climate change.  This is a complete straw man since absolutely nobody claimed that it would.  It is rather that the scientific community and the Progressive media wishes to advance a narrative that climate change is a wind that will blow everyone ill in every way.  The greening of the planet is an example of a good thing that comes from increased CO2 and a warmer climate.  The title of the article says that the greening of the planet is terrible and this argument doesn't support that statement in the slightest.

The fourth item is that the greening may not last forever.  That a good thing may not be permanent doesn't make it terrible while it lasts.  Furthermore, the article doesn't actually present any evidence that the greening will end.  It simply asserts that one cannot prove that it will last forever.  Of course, that is possible due to unforeseen interactions of the climate with the biosphere. However, that is an unlikely result for which there is no support.  

So, here we see one of the most prestigious, if not the most prestigious, newspapers in the world publishing a piece of propaganda, simply to blunt any objection to the narrative that CO2 emissions are anything other than an unmitigated negative.  It makes the blatant statement in its headline that, in the long run, global greening is terrible and then provides not even a little bit of support.  If it was the only example, we could ignore it, but it is the prevailing treatment of global warming issues.  It needs to be nullified and that can't just be done with YouTube videos and obscure articles.  Hard research is required.  Several things in the article are not well known, primarily because it is not well studied.  Nearly 5 billion USD is being spent on climate research directed at finding out 'how bad is it?' and virtually nothing is being funded to find out 'how good is it?' In fact, when good impacts of AGW are inadvertently found, effort is expended specifically to neutralize it.  That needs to be fixed.

Economics is an area where politics and ideology constantly invades the science. There are many examples, but here I will consider the war between Supply Side and Demand Side Economics.  Sadly, the vast majority of the research is targeted at proving one side correct and the other side wrong.  In truth, it is a false dichotomy that intelligent lay people can grasp.  Supply Side says that money made available to enterprises will cause them to produce more, hire more people, who will then have more money to spend and will buy the extra production.  The Demand Side argues that if you put more money in the hands of the consumer, they will go out and spend it which will create more production and more hiring, etc.
 
Even a naive analysis makes it patently obvious that in order for the Economy to grow, consumers must have more disposable income and enterprises must have the capital to buy more equipment and finance increased working capital needs.  If consumers have more money, but enterprises can't produce more, the extra money will simply cause inflation.  If the enterprises have more money, but consumers do not, the enterprises will likely buy back their own stock, since producing more will simply result in inventory surpluses.  Clearly, an enlightened attempt at increasing Economic growth will attempt to increase both.  It will also, as is the case right now, stimulate automation and fund education if there is a labor shortage in the needed jobs.  This 'hypothesis' is not being researched and disseminated because politics has taken over the discourse.

We understand that right now, the developed world is likely to go through an explosion of unemployment as driverless cars and trucks, automated restaurant kitchens, AI replacement of clerical and low level professionals, takes out literally millions and millions of jobs.  Sadly, the current research is designed based upon an acceptance that the Technological Unemployment is not a Luddite Fallacy. While this isn't actually supported by solid research, it is being substantiated with research that is intended to justify a UBI (universal basic income).  In other words, this is Social Engineering masquerading as science.

My purpose is not to make a comprehensive argument for junk science being used to forward a Progressive agenda, but rather just to give a couple of examples.  It is everywhere, especially, but not entirely within the Social Sciences.  The problem is that literally billions USD is being funneled to Academia for this purpose and almost none is being provided to researchers who will likely weaken the Progressive arguments.  I am suggesting that those who are not Progressive, either by virtue of being a Conservative or neither Progressive nor Conservative, but dedicated to good science, create a research fund for that purpose.  I have no illusions that anything even close to the billions of research dollars that are being commandeered to this end can be matched by such a fund.  However, at least the practice will not go unchallenged.  

The research funding will fall into two broad categories.  The first is research areas where only research likely to support a political or ideological position is being funded.  Someone should be funding research that may draw an opposite conclusion.  The other is research areas that are not funded at all because the resultant research may produce politically or ideologically uncomfortable results.  It is important that the latter is chosen for its scientific merit, not simply to add to the ammunition available to the anti-Progressive side.  The purpose is to blunt the effect of ideology on science.  I, for one, would contribute to such a fund.

An Information Age Income Model

Inequality has become a political hot button primarily because a shrinking middle class is leading to a bimodal population with regard to income.  It is important to recognize that, as the middle class shrinks, both the upper class and lower class are growing with the upper class growing about twice as fast.

The most common statistics being quoted revolve around the income and wealth of the upper 1%.  This is, of course, good political rhetoric but poor analysis.  The implication is that the '1%' are becoming wealthy through unfair circumstance; they are born wealthy; they were lucky; they got an unfair advantage; they cheated, etc.  It is understandable that people don't  want to think that the wealthy earned their wealth fairly.  However, wealth inequality is primarily the result of the Pareto distribution, known more commonly as the 80-20 rule.

The distribution is named after Vilfredo Pareto, a 19th and 20th Century Polymath who found that 80% of Italian real estate was owned by 20% of Italians.  However it proved to not be a trait of just the Italian economy.  The Pareto distribution started popping up everywhere.  For example, 80% of peas come from 20% of the pods.  80% of sales comes from 20% of the salespeople.  In fact, a Pareto distribution is a hallmark of a statistically fair game.

It is widely published that the top 1% of Americans hold 40% of the wealth.  What does Pareto say would be the result of a fair game?  In this regard, .8³=51.2% and .2³=0.8%.   1% computes to 52.8%.  In other words, a "fair game" could be expected to result in an even greater concentration of wealth and income than prevails today in virtually all of the developed world..  However, it should be recognized that it would be fair in a mathematical sense only.  Social justice considerations would likely not consider it fair at all.

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Still, many, perhaps most, people are inclined to consider modern wealth inequality to be the result of a rigged game, while the facts don't really support that.  Rather, as some wise people have noted, life is not fair.  Pareto assures that there are relative winners and losers.  This is partially because the modern Western society is based upon free enterprise, expressed through a 'dominance hierarchy'.  However, primarily it is a simple result of income and wealth being earned by value added and Pareto applies to actual contributions.

Free enterprise is extremely efficient, but it is heartless.  As Pareto demonstrates, it tends to create a small percent of 'winners' at the expense of many 'losers'.  Having said that, because at some level society is, and should be, viewed as a social contract, the notion that the value of labor is zero is counter to that proposition.  If income varies consistent with a Pareto distribution, that is what it would be implying.  In recognition of this practical reality that people won't work if they are not paid, we propose here an income model I=MW+P where MW is the value of productive effort in the form of a minimum wage, whether de jure or de facto, and P is The Pareto share that, calculated as P=I-MW, can be considered a recognition that those who add more value  through above average competence, innovation, capital, etc. should be rewarded with greater purchasing power.

While nothing more than a recognition of how liberal democracies function, it places discussions of income inequality on more firm theoretical ground.  In other words, while establishing MW or minimum wage is somewhat arbitrary, one can approach it analytically by subtracting the Pareto Distribution from the actual income distribution and the remainder is the aggregate MW which allows us to calculate a minimum wage.  While precise, it fails on the basis of social justice.  We prefer establishing a democratically arrived upon  value for MW and then considering whether it is consistent with the computed P = Pareto and if not, consider why and what, if anything, we, as a society, should do about it.

We can make a philosophical statement about MW, such as, "Every full time worker should have the resources required to fund a dignified life".  While it certainly sounds like an appropriate criterion, it still leaves plenty of room for interpretation and, therefore, disagreement.  I happen to agree with it.  

For example, one could find the rent for a marginal, but healthy, 3 BR apartment, divide it by 28% which is often cited as the qualifying income for housing.  This would establish a minimum income for a married couple with two children.  Suppose that rent is $1,200 per month.  This would result in a calculated MW of $12.36 per hour with both parents working.  This logic won't compel a consensus on a proper minimum wage.  However, it should lead to an organized discussion amenable to objectively supportable positions.  

We disregard the 1% as a measure of the wealthy.  The problem is that if the number of the wealthy changes significantly, the income of the 1% will change significantly and in ways not reflective of the change in income for its members.

The more technically supported measurement of income inequality is the GINI index which measures the  deviation of the income distribution from perfectly equal distribution. The generally accepted position is that a high GINI, which indicates greater inequality of income, is intrinsically bad.  However, it is a continuous function with no points of inflection.  Therefore, while relative inequality is properly measured, there is little or no criteria for establishing a point of fairness or economic justness. 

The free enterprise principle, with some modification, is that one's right to consume should be commensurate with the value one adds.  This contrasts with the Marxist philosophy of "From each according to their ability, to each according to their need".  The income model, herein proposed, is predicated upon the free enterprise principle and, as such, extremely high incomes are accommodated. In other words, if one  creates 10,000,000 USD of value added, one should receive 10,000,000 USD in compensation, save for a potential reduction for MW, if the established value is more than the actual value added.

As we set a framework for considering what should be MW we can also consider a framework to replace ''the 1%'.  There could be many ways to describe the wealthy.  One could be to see whether a family can afford the cars of the rich.  Husband drives a RR Wraith.  Wife drives a Bentley GTC and they have a Escalade for a SUV.  Per normal budget guidelines, a family needs about one million USD income to afford this fleet.

Neither the home cost calculation of minimum wage, nor the auto calculation for the definition of the wealthy should be taken as a serious argument for definitions.  They are intended as simple examples of a basic logic.  Most governments establish official poverty levels. However, these are not dignity levels and the two may not bear a consistent relationship to one another.

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By bifurcating household income into two distinct factors, minimum wage and pareto distributed free enterprise income, arguments over income inequality cannot be so easily conflated. One discussion would revolve around what constitutes a dignified life. Another conversation will revolve around any difference between the calculated and actual Pareto portion. These discussions will organize the issues but almost surely won't drive a consensus. However, differences in positions will then require more rigorous support..

The MW+P model will also inform the discussions about taxation and social policy. There are three categories of citizens with regard to the model. They are

1) people who cannot achieve MW without community assistance. This could be because of disability or simply, based upon economic conditions, because they cannot compete successfully for existing job openings 2) The bulk of citizens who earn more than MW but less than the income defined as wealthyand 3) the wealthy, which, as likely defined, will constitute less than 1% but more than 0.1%.

It seems obvious that taxing group 1 would be fruitless. Taxes on the wealthy, most of whom are extremely mobile, must recognize that, if their taxes are too high, rather than raising revenue, it will result in the wealthy moving themselves and their businesses out of their current tax jurisdictions.

That leaves tax policy a matter of the rates and progressivity between 0% and the wealthy rate. This allows for sufficient latitude to facilitate robust disagreement but puts a practical upper limit on the revenue that can be raised via income tax.  Reviewing the tax policies of developed countries suggests that the top tax rate that is supportable is around 35%

There is also plenty of room for disagreement on the degree and nature of group 1. One could argue that some members of group 1 should experience a lifestyle below the agreed upon level of a dignified lifestyle.  The main argument would be that giving members MW would disincentive them from aspiring to moving into group two.  However, in Western civilization, that may be a very unpopular position, and will not be articulated by any mainstream decision makers.

Some may argue that beyond a progressive tax at the bottom of group 2, the tax rate should be flat.  Others may wish a heavily progressive tax.  However, they are limited to the rate levied upon group 3.

Enlightened tax policy will result in an objective calculation of the tax rate for group 3.  It is a calculation similar to the Laffer Curve.  A low rate will generate low revenue.  As the rate increases revenue will increase until the number of members of group 3 who leave the taxing authority will increase sufficiently to reduce total revenues.


  

Humanoid Robots May Be Imminent

Star Trek: The Next Generation, set in the 2360s had a crew member, Data, that was an android or humanoid robot.  While a Data is not likely any time soon, a reasonable facsimile may be available far sooner than is generally imagined.  Current technological progress is not inconsistent with a product introduction around 2030.  However, while completely functional, it will in no way be artificial general intelligence as imagined in ST:NG or by Singularitarians.

The problem of creating a humanoid robot is comprised of two pieces -.  one, the robotic body, two the artificial intelligence.  Both technological pieces are currently exploding. What is necessary, primarily, is to bring together the various technologies that are currently being developed into one robot.

First, about simulated artificial general intelligence (AGW)
In 2005, Ray Kurzweil published, The Singularity is Near.  I had not yet started blogging, but I argued vociferously within my intellectual circles that, because Moore's Law would not continue to 2040, the Singularity was not only not near, it likely was far, far in the future.  I got nothing but push back at the time, but now most observers recognize that Moore's Law is dead and that progress henceforth will be much slower.  There are, of course, those who still believe that we are in a pause and that Moore's Law will reignite.  Many of them still pursue the goal of AGI (Artificial General Intelligence) which is a cornerstone of the Singularitarian vision.  While that is both anthropomorphic and overblown, if not totally improbable, simulated artificial intelligence is right around the corner, it will likely be given an I/O modality that will be a very credible humanoid.  I am not talking about in the mid 2040s; I am talking about something closer to the late 2020s.

Right now, there are quite a few natural language internet search engines.  Apple's Siri, Microsoft's Cortana, Amazon's Alexa or Android's Google Voice are the mostly widely used.  With these systems, the user asks a question of the 'assistant' verbally and they receive an answer, not from a third party website, but from the virtual voice assistant.  Sometimes, as Siri does quite often, it will be with a citation, such as 'According to the World Health Organization, France has the best Health Care system in the World'.  

These natural language interfaces are becoming more and more capable, accessing your calendar, Google Maps, Pandora, Waze, etc.  "Out of the box", Siri will not play chess with you, but that is a simple interface problem that techies can and do solve.  The same is probably true for IBM's Doctor Watson or other medical databases.  In fact, Siri can piggy back on IBM's Watson software.  In other words, making Siri or any other virtual voice assistant appear to be as smart as the total Internet is just a simple problem in programming.  In fact, likely, within five to ten years, natural language assistants will be able to do just about anything you want them to do.  They will likely pass the Turing Test and seem to be an insanely knowledgeable and capable human.

There is no doubt that such an advanced Siri or Alexa is not true Artificial General Intelligence.  When it interacts with the user, it is acting as a natural language I/O device.  When it plays chess with the user, it is accessing programs that determine the next best chess move through algorithms, not through anything resembling true thought.  Siri or Alexa is not conscious.  It has no reflective ability that allows it to contemplate its own existence.  One may argue that the Internet, collectively, is intelligent, but it is not so in the same way as we mean when a human is intelligent.  It is most definitely an artificial intelligence and the 'general' in AGI is simulated.

The 'Personal Assistant' Robot
This 'personal assistant' can, today, easily be put in a robot.  In fact, right now, it is being put in telephones.  The PAR is farther in the future than the simulated AGI into which the current personal assistants are morphing.  However, they are not that far in the future and the first ones will probably appear in about a decade.  Already, Boston Dynamics has plans to offer its 'spotmini' to the general population.

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By this method, the PAR it will accurately simulate AGI and appear to be a conscious entity more knowledgeable,  and expert than any human.  However, as we know with current personal assistants, chess programs, etc. it is not AGI.  It is SGI or simulated general intelligence.  While the quest for AGI will likely continue in the lab, SGI will be a cheaper and less troublesome product.  SGI is the future and it is here in rudimentary form, already.  And the competition is stiff and improvement is therefore rapid.

Scene analysis is critical to the effectiveness of a PAR.  Fortunately, due to multiple applications, the technology is advancing rapidly.  Clearly, Boston Dynamics has installed relatively good software.  This acrobatic display by their Atlas requires astonishing scene analysis.  It may be that soon their robots will exceed human capabilities.  Obviously, the average human could not duplicate this display of scene analysis and body control.




Not surprisingly, but equally important, Boston Dynamics Atlas robot can run over uneven terrain with amazing ability.  So, we see that the technology needed to allow robots to move about freely in a human or nature environment is already here.  The question is, how low can they get the cost.  A million USD robot will have very little consumer application but a 25,000 USD robot probably will assuming that it comes with sufficient manual dexterity and SGI.

Boston Dynamics is not a leader in robotic hands and fingers.  This research and development has been driven primarily by prosthetics and it is already very advanced.

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The construction of human-like bodies and faces, driven, in part, by competition between sex robot manufacturers, is progressing rapidly.  The companies that are creating the most humanlike faces are not at state of the art voice interaction, but, while not at the point of fooling anyone are getting quite good.  It is important to note, especially those presented by Hanson Robotics, that many videos of human-like robots are scripted and presented as real AI that is well beyond current technology.

However, as Siri and Alexa demonstrate, the current AI is quite sufficient to function as a useful personal assistant.  We are seeing that these executive programs are advancing rapidly.

It is clear that bringing together the most advanced current technology, in just a few years a first shot at a humanoid robot would likely be successful.  The business potential may be enormous.

Of course, the likelihood of market acceptance will be based, among other things, upon price vs. benefits.  One of the primary benefits is to organize and execute the details of one's life.  As Google demonstrates here, much of what can be done already. However, picking up dry cleaning, grocery shopping, etc. will require a physical presence.

The other significant benefit is as a domestic, that cleans, cooks, gardens, does home and auto maintenance, etc.  It is, in fact, the primary benefit of a humanoid robot, over a virtual robot, such as Alexa.

Robots have no life of their own, so the only down time is for maintenance.  They may need 10% for charging and maintenance.  At $10 per hour equivalent, the net present value of a robot's work will be around 500K USD.

While the present value may be 500K USD, the cost will need to be less in order to be a successful product.  A basic robot may cost the same as a luxury car, say 100K USD.  There will also be some operating costs.  A total monthly cost may be around 1,000 USD.

With, say a 2% initial market penetration, the industry may start St about 100 billion USD but has the potential to grow much, much larger.

The basic models will likely look like Atlas or Asimo.  Many people find the more human robots 'creepy' and they actually prefer the Asimo style models. There is controversy right now over Harmony, the sex doll, by Real Doll.  Real Doll and and it's competitors are naturally the most aggressive group in pursuing human like-robots.  On one hand, most people will likely have a negative reaction to this degree of human simulation, but on the other hand, some people may be willing to spend substantial funds to create very life like and custom designed robots, a la Stepford Wives.

Most humanoid robots are currently not for sale, the exception being Harmony, which costs 15,000 USD.  She is, however, far from complete, with no movement below the neck.  However, if the initial price point is 100,000USD there is plenty of room for improvement.

There are many activities that will be appropriate for PARs, but there will also be plenty of roles where people will prefer humans.  Home domestics, hotel house cleaning, etc. will likely be robots, however, fashion consultants, personal trainers, wait staff, doctors, police, etc. likely will remain human because people will prefer the 'high touch' of real people.

Why Social Security benefits will actually explode

The Transformation will see a tenfold or more increase in prevailing incomes.  In other words, the typical family who, today, earns 55,000 2016USD will earn 550,000 2016USD or more by 2030 or so.  This is relevant even to a person already on Socia Security now.  I will be 80 and plan on having an active life and at least another decade of fun.  Social Security will finance some of that fun.

Now, today, the maximum income upon which Social Security tax is levied increases at about inflation and the benefits increase at about inflation.  What this means is that when we enter the period of dramatic income growth, if Social Security benefits remain constant on a real basis, their payment will represent a burden upon income producing people that is only 10% of what it is today.

However, the politics of it won't allow that to happen.  Right now, most people pay 6.2% of their income into the system.  That rate will fall to an average of .62% and this will happen by most people earning far more than the maximum base.  At the same time, the number of retired people will increase and, already a formidable voting block, they will be able to elect or defeat nearly all candidates if they violate basic political preferences.

What that means is that the astute politician will index the maximum taxable amount, not to inflation, but rather to GDP per capita.  The more progressive position will be to take the limit off entirely.  In combination with a lowering of the rate, this is the more expedient course of action early on.  Once most people exceed the maximum, the former proposal will be more attractive. 

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In other words, today, progressive candidates should argue that the limit on taxable income is regressive and should be eliminated in exchange for a slight reduction in the rate.

If this comes to pass, the revenue generated for the Social Security fund will grow rapidly and there will be significant pressure to increase benefits. Because of the amount of income increase, retired people will become one issue voters and both Republicans and Democrats will be driven to satisfy the call to allow retired people to share in the income explosion.  This can be done while actually improving the liquidity of the system.

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The argument will be made that current payers are actually paying a lower percent of their income than the current retired people paid.  That logic will blunt objections, though no such blunting will actually be necessary.  What it will do is mollify younger people who will likely accept it with little or no complaint.  After all, this is their parents and grandparents.

What will happen in the U.S. will happen through different mechanisms throughtout EUNA.  However, the average Social Security benefit will probably fall as a percent of the average salary, so, even though retired people will see a dramatic increase in purchasing power, they will have relatively less affluence.

On Transcendence

Maslow identified the highest level of his hierarchy of needs as self-actualization.  I have expanded this to, in aggregate, a concept that I call 'The Finely Crafted Life'.  This includes not just self-actualization, but also self-improvement (for Polymathicans erudition is a large portion of this), aesthetic expression, social justice and transcendence.

As incomes explode across the world, most populations will be pushed up Maslow's Hierarchy of Needs.  In other words, when median household income is 500,000 2015USD, the lower level considerations of shelter, food, clothing, health care, etc. will become relatively insignificant. Everyone will have these things and people will begin to think of higher level needs.

Among the quintessential Polymathicans I have only gotten push back on transcendence.  Apparently many perceive this as code for religiosity.  While consideration of religious questions is part of transcendence, that is an inaccurate interpretation.  Transcendence, as I use it, is a relatively complex concept that actually contains its own hierarchy of meaning.

At the most basic level it means transcending the purely animal aspects of our motivations, behaviors and interests that are fairly well summarized in the lowest of Maslow's levels.  The Polymathican quest for erudition is a good example of this.  People who are functioning at the lower Maslow levels view education as a route to a job, which is a route to money, which is necessary to satisfy Physiological and Safety needs.  Polymathicans view erudition as an expression of humans' basic curiosity and consequently seek knowledge and understanding for their own sake, not as a tool to satisfy animal needs.

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Transcendence also can be interpreted as a desire to externalize oneself, or to transcend self-interest, even enlightened self-interest.  Specifically, the transcendent person will be informed by ethical principles that are not based upon efficient functioning within their proximate social environment.  In this sense, transcendence stands opposite to Utilitarianism and more generally Consequentialism.  It implies that principles govern and that while the ends inform us as to the morality of the means, they do not, alone, justify them.

It has not been uncommon, in the history of Philosophy, to reify the non-animal character of humans as a soul or, alternately, the super-ego. Contemplative, reflective and synthesizing, it appears, experientially, to be in some way non-corporeal.  It is to this definition that some Polymathicans object.  In doing so, they are confusing the answer with the question.

The question is, 'To what do I refer when I refer to self?'  For some the answer may be a higher order, self-referential, manifestation of cognitive activity.  This answer does not make humans unique in their transcendence.  There is strong evidence that several other mammals are capable of recognizing themselves as individuals. However, it is an Objectivist interpretation of transcendence, not a logical repudiation of it.  In other words, it recognizes that some animals, including humans, cannot be explained entirely by describing them as 'survival optimized stimuli-response machines'.  There is something more, transcendent, about these animals.

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There is a second order interpretation of transcendence that involves the contemplation of the human species' relationship to the rest of the universe. As a greater percent of the population gains sufficient affluence to focus on the higher Maslow's levels, this has become an important issue.  Some people believe that humans, in fact all species, have a moral imperative to place their well-being above the well being of other species.  Others think that humans in their ethical considerations should weigh the well-being of all species equally.

This is inherently a transcendent question.  Pure animals will pursue their own survival and well-being without any considerations of transcendent meaning. In fact, no animal, save humans, will contemplate the question at even a rudimentary level.  For that matter, only transcendent humans will.  Many, perhaps most, people spend little to no time thinking about this.

So, while I appreciate the negative connotations that the term transcendence has for many people, including some Polymathicans, I do not apologize for its inclusion.  In fact, I would argue that transcendence, in its several meanings, is above self-actualization on a modified Maslow's Pyramid.  I would also say that Polymathicans are not characterized by their answers to transcendent questions, but rather by their interest in them.  

The Case for Energy Subsidies

Energy is unambiguously unsexy.  It runs our cars, warms and cools our houses, which are necessary functions, but we really want it to be as invisible and inexpensive as possible.  This distinguishes it from nearly every other purchase we make, where both price and features enter into our decision.  We do not all buy the least expensive car, least expensive sofa, least expensive shirt, etc. However, we do want our energy to be the least expensive available.

This assumption that all energy is fungible is inherent in the alternative energy conversation where comparison of 'cost per unit' becomes the primary, and in some cases only, consideration.  However, a growing number of people are inclined to inject the features of cleanliness and renewability into the conversation.  These are not benefits that redound to the individual consumer, but rather to society as a whole.  As such, there is an altruistic element to it.

A problem arises in the implementation of any additional features to energy supply because the ability and willingness to subsidize these features varies substantially among citizens.  The typical two wage earner professional family with a household income of, say, 150,000 USD is likely to be willing to pay 50% more for electricity in order to subsidize clean and renewable sources.  A single mother of three with a household income of 30,000 USD may simply not be able to afford it.

Given that we want a clean, functionally inexhaustible source of energy, the best base load will likely be Enhanced Geothermal Energy (EGS), though it will likely never be the least expensive.  The essential technology is to drill a hole until a depth is reached where the rock is of an optimal temperature.  A chamber of fractured rock is created, water is dropped down which converts to steam and is used to run a turbine.  Water is condensed and recycled.  

The technology is particularly attractive because it has minimal surface presence, unlike solar and wind that require enormous 'farms' covered with energy collection equipment.  In fact, the power plant could be built underground so that all that is visible on the surface is the transmission cables.

Of course, much of our energy usage is currently in the form of hydrocarbons.  We use gasoline to move our cars and natural gas to heat our buildings.  However, technologies are emerging that will allow both to be accomplished using electricity.

Modern heat pumps will cool building interiors and heat them when the outside temperature falls as low as -20F.  Fuel costs are competitive with natural gas and less expensive than heating oil.  With populations consistently moving to lower latittudes, this will eliminate nearly all carbon based heating.

The ultimate transportation solution, which may be upon us prior to 2030, will be self driving electric cars that get their energy by induction from the roadway rather than being stored in on board batteries.  This will likely be less expensive, in total, than our current gasoline driven system, however, transitional periods may be more expensive.

The ability to subsidize energy premiums related to benefits that accrue to the common good increases exponentially with income.  I am not in favor of subsidies for the cost of goods and services as a remedy to income disparities.  It is more efficient to subsidize income directly.  Also, by subsidizing specific products and services the government is making lifestyle judgments which reduces liberty.  However, here we are recognizing that the cost of energy has two identifiable components, 1) the cost of energy by the least expensive source and 2) a premium related to specific choices for the sake of cleanliness and renewability.  It is not only acceptable to subsidize the second, one my justifiably argue that since the benefit is to the community, the cost should be borne by the community.

The U.S. has attempted to subsidize energy sources directly which has led to large payments to energy equipment manufacturers that have subsequently become bankrupt and thus benefited nobody.  It is much better for the government to mandate a percent of energy supply that must be clean and renewable and then compensate the producer so that they may charge the ultimate consumer the price that would prevail with a least cost supply.

In my ongoing planning of a Polymathican microstate, this is precisely what I propose.  The microstate will subsidize the production of electricity, with base load satisfied with an Ocean Thermal Gradient System (OTEC), with the difference between the microstate's cost of service and the average of Southeast U.S. rates.

We will use OTEC because the island, Samana Cay is very close to deep water and the surface water temperature is extremely high.  Using the open cycle design, it will produce truly enormous quantities of fresh water.  Peak Shaving will start with the daytime burning of garbage.  Excess base load will be converted into synfuel that will then be burned during peak load times.  A strategic supply of synfuel will be retained to provide emergency supplies.

The net effect of the above is that we will not develop piles of garbage, all energy production will be local and the supply is secure from interruption.  This will not be as cheap as building coal fired plants, but the benefits to the community are worth the additional cost.  It just shouldn't be borne by individuals but rather by the community as a whole.  I hope that this model becomes the norm as North America and Europe moves toward renewable energy supplies.






  

The Fallacy of the 1%

I listened to U.S. Democratic Presidential debate the other day and I was dismayed by the incessant hammering the participants applied to the 1% richest people. This only works as a political tactic, and it works quite well on the left side of the spectrum, because people don't understand statistics very well.  Specifically, people are predisposed to accept a reification of a statistically defined classification.

Four years ago, $350,000 per year household income was sufficient to be in the 1%.  Today, household income must be over $500,000 to make the top 1%. People look at that and conclude that while the rest of the country saw little or no real increase in their income, the 1% saw an increase of nearly 50%.  Let me state this without equivocation.

This is good politics but it is horrible statistics!!!

This 'us vs them' mentality has become so pervasive that it will not be easy for most readers to have their perspective on this corrected.  However, it is very important that they do.  It is one of those cases where people's thoughts are being manipulated for political gain.

The 1% is not a monolith.  It is fluid. Families enter the 1% and then, as often as not, leave it.  By age 60, 11.1% of families have at least one year in the top 1%. Only about 60% of those families who are in the top 1% for at least one year in their life will be in the top 1% for ten or more years.  This is what I mean by reification.  There is no ccommunity of wealthy  While some members of the top 1% persist, it is generally comprised at any one time of less than 10% of those who will be in the group at some piont. 

For example, a family that earned $350,000 in 2010 was in the upper 1% that year.  Even if they got raises of 6% per year, well above what was received by the middle class, in 2014 their income would be about $440,000 and they would no longer be in the upper 1%.  Put another way, it is not that the wealthy got huge income increases, though some did.  Rather what happened is the amount of income needed to make the top 1% increased significantly, primarily because new people entered the ranks of the wealthy and often they did so at an income level well above the minimum requirement.

Part of what causes this are many small business owners who sell their business and retire.  In the year of the sale their income can reach the upper 1%, but it will go back down the next year and from then on.  They only sell out and retire once, but there are so many small businesses that they still comprise a significant portion of the top 1%.  Because the 'baby boomers' are retiring now, this is particularly important.

The idea that there are these 1% wealthy families who are getting huge income increases and everyone else is getting nothing is just not correct.  The proper analytical approach is to choose an income level designated as 'wealthy' and look at what percent of the population meets or exceeds it.

Let's look at $350,000 per year which in 2010 was the cut off for membership in the despicable 1%.  Because we want this to be absolute purchasing power, we will increase it by the CPI.  That means that in order to have the purchasing power of 350,000 2010USD a household would need to earn 373,915 2014USD.  So, this is the proper way to look at it.  

In 2010, 1% earned over $350,000.  In 2014 about 1 1/2% earned over $373,915.  It is not so much that the rich got richer as they got more plentiful.

It is likely that for those who were in the 2010 1%, their income increased significantly.  After all, they are participating in the Information Age economy which is inherently growing.  For example, during this period, online sales increased at a rate of aboutr 11% per year, substantially higher than the economy as a whole. However, the arithmetic process of determining the average income of the 2010 top 1% and the 2014 top 1% does not valid.  As we see from the above, in 2010 we are calculating 100% of what we are calling 'the rich' where in 2014 we are calculating the top 67%.  The average income of 'the rich' is going to go up just because of that.

There does exist an emergent and more meaningful demarcation of the population. However, it is not defined directly as income, which actually serves to obfuscate rather than elucidate.  It is properly defined as those who are entering the Information Age economy and those who are stubbornly (or desperately) holding on to the Industrial Age paradigm of trading time for wages.  

The former typically have incomes in the '1%' range (now the 1 1/2%) and are seeing rapid incremental increases in their income.  The latter are finding that their value added, at best, is remaining unchanged.  With an approaching wave of accelerated technological unemployment this situation is going to become much, much worse.

Consider a person who is working for $60,000 per year in an Industrial Age job and then decides to create an Information Age career.  The research indicates that typical successful Internet companies will triple their revenue each year for the first three years.  Then growth will begin to slow down until the enterprise reaches market saturation.  

Let's assume that this person starts his or her business with a book value of $100,000 and has a theoretical return of $67,000 per year (See Death of Capitalism).  In the first year or two, (s)he will actually experience a decrease in both cash flow and stated income, because most of the return will go to growing the business. However, by year four income has reached $1,800.000 ($67,000 x 3^3) and growth has slowed enough to create significant cash flow.  The person now is safely ensconced in the '1%'.

This is what we are seeing.  People literally leap into the Information Age income range over the course of just a couple of years, sometimes in just months.  They leapfrog members of the '1%' and displace them.  Here in Sunny Isles Beach, which is designed for households with million dollar plus incomes, I see it often enough.  

For example, one fellow lives in a $3,000,000 condo on the beach and owns a Bentley, Ferarri and AMG S65.  He became an affiliate for an online pharmacy and found a way to drive huge amounts of traffic to the site.  Many online pharmacies are paying 25% commissions, so 10,000 customers buying $20 per month of medicine is $50,000 per month in income.  He apparently does better than that.  He hasn't shared how he does it.

Another fellow drives around Sunny Isles Beach in a new white Rolls Royce Wraith.  Just last year he started a business where he charges wealthy Russians $150,000 each to get permanent residency status.  His service just exploded on the scene in a matter of a couple of months.  Just one new client per month puts him comfortably in the top 1%.

Yet, another fellow started an online pet supply site.  It went from two employees to 170 employees in just four years, easily exceeding the tripling every year for the first three years that is the norm.   Now, he owns a yacht parked next to his penthouse condo at the marina and drives a Bentley.

These are the new members of the Information Age elite.  They literally leap into the upper income ranges from the lower 99% and displace previous members of the 1%.  They vastly outnumber the investment bankers, hedge fund managers, Fortune 1,000 CEOs and top level lawyers that we are encouraged to think of when we think of the 1%.  These new Information Age workers are getting almost all of the increase in GDP per capita from the U.S. economy.

This distinction is very powerful.  One thinks quite differently if one thinks in terms of the top 1% getting all the GDP growth than if one thinks in terms of an additional 0.1% of the population joining the Information Age workforce each year.  With the first you will likely think in terms of a closed door country club to which you do not belong and to whose members all the goodies go.  You will tend to think of income acquisition as a zero sum game and you are on the wrong end of that game.  In the second you are more likely to ask, 'Why them and not I?  Why do I not decide to become one of the 0.1% who join this group each year?'  Why not, indeed?

By 2040, more than 50% of the population will belong to 'the 1%.'

Clearly, from the country club, zero sum game world view of 'the 1%' the above statement is ridiculous. However, when viewed from income rather percentile, plus sum game, it makes perfect sense.  Whatever income level a person sets as the cut-off for 'the rich', the number of households that achieve it, in real dollars, is growing and will continue to grow.

Like most economic trends, the percent membership in the Information Age workforce will grow following a logistic or 'S' curve.   In other words, for a couple of decades the 0.1% growth in the Information Age workforce will increase - 0.1%, 0.12%, 0.14% etc.  This means that while the increase in the '1%' is easy to miss today, it will become obvious within ten years.  As it does, the clear bimodal profile of Information Age workforce and Industrial Age workforce will become apparent to all.

Income and wealth inequalities are unavoidable and, for most cultural value systems, appropriate.  The current concern is over its relative increase over recent history.  In 2007, the top 1% earned about 22% of total income, a percent last seen nearly 100 years ago right before the great depression.  (Note: some non peer reviewed sources place this as high as 28%)

It has generally been blamed on rather simplistic mechanisms such as the transfer of costs from labor to capital expenditures.  Because the wealth disparity has always been greater than income disparity, an increase in capex is seen as the source of the increase in income disparity.  However, a Council on Foreign Relations white paper that, while including technological unemployment, also assigns some of the cause to globalization of the labor market, increases in the education premium, etc. 

However, while not invalid, that is an Industrial Age way of thinking.  If we consider who is entering the top income tier and often entering well above 500,000 USD 1% floor, it is essentially people who have mastered the use of high efficiency Information Age marketing.

The pet supply marketer succeeded because he uses the more modern advertising techniques where you will or will not see his display ads based upon the cookies on your computer.  The permanent residency consultant and online pharmacy affiliate found very efficient ways to connect their potential customers and their service.  That is the single biggest secret to joining the Information Age workforce.  It is not easy which is one of the reasons that only 0.1% are managing each year.

We see two countervailing forces at work.  Advanced robotics and AI are increasing GDP through improved productivity.  It is causing technological unemployment which depresses compensation of Industrial Age jobs.  At the same time, the new productivity tools are making it possible for individuals and small groups to enter the Information Age workforce which allows them to jump quickly to high income.

There are three steps that appear to be essential to success.  They are

1. Find a product, service or content that is marketable to an identifiable market niche
2. Find a marketing channel that will allow cost effective access to the market niche
3. Create a business model that is profitable and allows for high internally funded growth

Of these three, number two is usually the stumbling block.  In fact, seasoned Information Age workers understand that finding a product is easy, building a viable business model is not difficult, but finding your customers profitably is the big challenge.  That is why the Internet is full of advertisements promising to show you how to acquire leads cheaply. By the way, they rarely work.

Despite this, every year some people succeed at it and jump to Information Age incomes.  As this happens, no matter what is taken as the floor income of the rich, the percent of the workforce that achieves it by joining the Information Age workforce increases over time.  However, by defining the rich on a percentile basis, whether that is 1% or 0.1% or even 0.01%, you are creating a moving target.  Every year 'the rich' is redefined and is forced to be an exclusive club with the same number of members.  As we saw, this kind of thinking results in some members of 'the rich' enjoying a healthy income increase and still finding that they are no longer rich.

However, if we define 'the rich' by an absolute, even if CPI adjusted, dollar amount, there is no limit to how many people can join.  Globally, over most of the developed world, I generally think in terms of 1,000,000 2015USD per year as a reasonable goal.  It will fund two super-luxury automobiles and a 500 meter home in most places.

At present, fewer than 1% of households earn that much and even fewer do so year after year.  However, over the next 20 to 30 years, 20% or more of households will reach that level.  The other 80% while not reaching that level of affluence will still earn a median household income of 500,000 2015USD. There will still be a 1%.  However, one need ask whether it will have any significance by today's standards.

By reifying percentiles of income we are confusing ourselves and interfering with our ablity to think productively about our collective economic future.