Friday, June 09, 2006

Road Music

A post over at a Wired's Listening Post about a musician/artist who noticed road ridges producing tones as he drove over them, and conceived of producing music (or a music-like experience) as a form of "installation art". For what it's worth (not much, I know) my old buddy Jeffery Priddy and I noticed something like this way back in college. Along some stretches of highway, the "shoulder strip" (the area just outside the lines but still paved) actually has deliberately placed and spaced sets of cross-grooves that make a dramatic racket as you drive over them. It's kind of an alarm system, to get inattentive or drowsy drivers back in their lane.

Our idea (or perhaps just Jeffery's, I don't know for sure and don't want to be a credit hog) was less musical but humorous (and possibly functional). By controlling the spacing of the bumps you could make the sounds into a voice “recording” of an appropriate warning, something short and attention-grabbing like “Hey” or “Wake Up!” Or alternate the two, “Hey… Wake Up!... Hey… Wake Up!...”

Thursday, June 08, 2006

Organic Obtuseness

I can’t, as of this writing, make some sort of general pronouncement on organic food. I believe the science is not entirely settled on many of the issues, but it seems likely that some of the “scares” or concerns about what is in our food may have some basis in fact, while others are alarmist scaremongering. Unsatisfying? Perhaps, but as a firm believer in rational, fact-based decision making, sometimes the real world is a murky place. A recent study showed an apparently striking link between the rate of twins and consuming dairy products from cows given synthetic growth hormone. That certainly got my attention, and I’m inclined to at least think about organic dairy products, although it still might be only a narrow effect, perhaps people who aren’t women about to be pregnant don’t need to worry about this. But then again, this is just one hormone, and perhaps we should be worried about all the other stuff in our food (or potentially in it). I think the case is a lot less clear in the case of trace amounts of pesticides and herbicides, for example. They may or may not act as endocrine disruptors in humans, which could be serious indeed, if true. An editorial by Michael Pollan in the New York Times cites alarming evidence about a particular herbicide, atrazine, which appears to cause sexual deformities in male frogs. But then, amphibian sex determination is dramatically different from that in humans and other mammals, so should we be alarmed? I think we should definitely be alarmed—at least for the frogs! I think a clear and dramatic effect on wild fauna like this is a significant environmental impact which should be assessed and (probably) mitigated or eliminated. But as to whether it is messing with human sex determination, the jury’s still out.

But Pollan writes about this issue in article about Wal-Mart’s decision to get into the organic food business, surely a good thing, if you believe in organic food, no? No, apparently not. Apparently the content of the food you eat should not be sufficient to qualify as “organic,” it must also be produced with minimal efficiency. Pollan, like many “environmentalists,” exhibits a fetish for inefficiency. “Organic” farms should necessarily be small farms, family owned and operated, producing small crop yields with much labor (loving though it may be), and the output to be sold locally at premium prices. Wal-Mart will accelerate the trend for organic farms away from this (already outdated) model to large scale production techniques. But of course farm size, ownership, and labor practices have no direct bearing on what is actually in the food. Mr. Pollan finds this to be some sort of an outrage, but if I buy organic food, I’m concerned about whether pesticide residues, trace hormones, antibiotics, etc. are potentially screwing with my body (or my children’s bodies), not whether it was hand-picked and packed by a fifth-generation farmhand (not that there’s anything wrong with that!). While Pollan and his ideological brethren are apparently up in arms about how the term “organic” is being “corrupted” or “hijacked,” I would contend that they are attempting the hijacking. This more expansive definition of “organic” is actually incorporating concepts better captured by the “fair trade” labeling scheme. Of course, Tim Harford, the Undercover Economist, exposed how “fair trade” is much more a marketing scheme rip-off than a real way to help developing world farmers, but if that’s your preference, have at it! “Organic” as labeled by the government, primarily concerns the substances in or on the food, and that’s appropriate.

No, apparently “cheap food” is an abomination in itself. Honestly, this is no exaggeration, it is explicitly built into Pollan’s argument. He writes:

As the organic movement has long maintained, cheap industrial food is cheap only because the real costs of producing it are not reflected in the price at the checkout. Rather, those costs are charged to the environment, in the form of soil depletion and pollution (industrial agriculture is now our biggest polluter); to the public purse, in the form of subsidies to conventional commodity farmers; to the public health, in the form of an epidemic of diabetes and obesity that is expected to cost the economy more than $100 billion per year
Here we have the classic “conflation” problem in spades. Is “cheap” food artificially cheap for failing to account for environmental impacts associated with conventional agriculture? Absolutely, this is one of those areas where environmental economics has some valuable things to say. Solutions to this problem involve capturing these “externalities” and thereby “internalizing” them. Allowing agricultural pesticide and fertilizer runoff to impact the environment imposes costs on those downstream and artificially subsidizes the cost of the food produced. So we should fix the problem by imposing the true costs onto the food producers, who will in turn, pass them on to the consumers. Similarly, do agricultural subsidies force taxpayers to subsidize giant agri-business concerns? Yep. Once again, this is right on the money. I’ve railed against these subsidies in this space before. A couple of great points and we’re on the same page.

But then we hit the part where obesity and diabetes are the “fault” of cheap food. Let’s be absolutely clear about this argument: food should cost more so that people will eat less and be healthier. Say what? For the great span of human history, people struggled to put food on the table. Famine was a pernicious plague that stalked the planet, following droughts, floods, wars and other humanitarian disasters. Now, we have at long last conquered famine because of modern agriculture. It is an indisputable fact that we can feed the world today, and in recent decades. Modern famines result from political and social failures, not globally inadequate food supply. I am not saying that obesity and diabetes are not real problems for American society, these problems are also indisputable. But to suggest that the solution is to make food more expensive by making food production less efficient is either ideological nuttiness or pathological stupidity, perhaps both. Raising the price you have to pay for the exact same item has a name: It’s called “inflation” and it increases poverty, human misery, and environmental degradation, especially when you are talking about the basic necessities of life, like food.

Efficiency and environmentalism are allies, not enemies. Productivity follows from efficiency: a way of getting more value out of the same amount of resources. Thus efficiency, and this point cannot be stressed enough, is generally to be embraced and not rejected, if you care about the environment and the human condition, which are inextricably intertwined, after all. Therefore it is not a given that a great expansion of the organic food supply would be “an unambiguous good for the world’s environment,” as Pollan would have it. Tradeoffs are inherent in every decision, and while a vast expansion of organic farming will lead to reduced pesticide and fertilizer usage, the total acreage under cultivation will undergo, well, a vast expansion. Organic production is less efficient by its nature than conventional modern agriculture, more produce is lost to insects without pesticides and yields are lower without industrial fertilizers, so you must put more acres under the plow to feed the same number of people. This land doesn’t come from nowhere! Does Mr. Pollan believe that Wal-Marts and strip malls are being demolished for organic farmland? Think again. Increased agricultural acreage come overwhelmingly from one source: currently undeveloped land. This means more natural habitat destruction and pressure on existing ecosystems.

This is not to say that organic farming is necessarily the wrong decision, environmentally. But to assert baldly that it is an “unambiguous good” is facile and specious. There are tradeoffs and uncertainties in the real world; that’s kind of the definition of “ambiguous” isn’t it? Organic farming is not a magic wand that produces environmental “goodness” free of charge.

Monday, June 05, 2006

Where'd You Get That Money? Uncle Sam Wants to Know

I work at a Very Large Financial Institution (VLFI), and so I had to complete an "anti-money laundering" training course. I am an IT professional, but I don't actually go near any customer information or account transaction data (those reading who know me personally might be exclaiming, "Whew!" and wiping their brow about now). Nonetheless, I was required to take this training, as it is a corporation-wide requirement. While this requirement seems a bit excessive given my job responsibilities, the course was not overly long and burdensome, and I understand the company has this blanket policy to ensure unambiguous compliance with any and all regulatory requirements. And there is the culprit! I have no quarrel with my employer (in this instance); while my workplace is not exactly free of Dilbertian nonsense and jargon, this particular bit of silliness is unambiguously the result of government pressure, and that is the point of this post.

Apparently having money is inherently suspicious. OK, perhaps not quite, but it's pretty darn close. The guidelines in our training indicate that if a new customer setting up an account has a "large" sum of money, it is the duty of the VLFI employee to ascertain the source of the funds. That is, when you walk into, say, a bank as a high-net-worth individual, you must apparently be prepared to justify your wealth, and so while having money isn't necessarily actually suspicious per se, it's only a half-step away. If you are reluctant or unwilling to explain where your money comes from, THAT is suspicious. Frankly, this seems awfully intrusive to me. It hasn't come up with me personally (drat!) but the idea doesn't sit well with me. Am I alone?

Let's be clear: if someone comes into a bank driving a car riddled with bullet holes and wants to deposit bags full of cash tinted with some sort of white powder, then OK, a reasonable, law-abiding person probably has cause to flag this person as suspicious. (Never mind, for now, that I personally oppose the drug war, I won't challenge that here.) There are already reporting requirements for large cash transactions; these are known to banks and other VLFI's as Currency Transaction Reports or CTR's (last time I looked). While it certainly could be argued that CTR requirements might be burdensome as well, let's grant that perhaps there is at least some reasonable state interest in watching large cash transactions. It is worth noting that some customers who establish ongoing relationships with a bank and are expected to be dealing with large amounts of cash on a regular basis (e.g. retailers who take in lots of cash) can be exempted from CTR's. But the anti-money laundering standards from our training course go well beyond any reasonable suspicion of cash. Cash doesn't have to enter into it. The source of funds can be check or electronic transfer, which already produces an audit trail. If you have a lot of money, your banker apparently expects you to explain yourself.

Now, I don't know if this is written specifically into law anywhere, I rather doubt it. My employer is likely being overly cautious and proactive about this "source of wealth" requirement. But rest assured, profitable companies don't just throw money around without some root cause. There can be no doubt that government regulators, in this post-Enron/WorldCom/9-11/Sarbanes Oxley world are breathing down the neck of VLFI's everywhere, to ensure that we aren't enabling terrorists, or drug-dealers, or tax-dodgers, or whatever (don't conflate all these together, as our leaders often do, that's part of the problem!). I think, in this instance, things have gone too far. It should not be the place of your bank, or broker, or insurer, to make you explain your money. Neither free markets nor the public at large benefits, generally, from converting the people you do business with into cops and/or government spies. That's what law enforcement is for. If we need more cops, then we should hire them. Pressing regular working stiffs like me into service as government snoops is only yet more creeping statism.