The small doing what the big can’t

Interesting article over at scientificamerican.com:
Local Governments Lead Effort to Combat Climate Change:

Call them the Silicon Valley garages of climate policy.

Local efforts to trim emissions, change economies and alter behavior are serving as idea labs where mistakes can be made and novel approaches honed in preparation for setting national climate and energy policy…

Local governments across the country are trying out a number of programs to improve energy efficiency, cut emissions, and generate green energy. Some are highly successful. Some are failing miserably. But there’s a lot of lessons being learned from all the different projects.

I’m glad to see there’s some ideas being tried out. We don’t really know what needs to happen to convert our lives from oil-based, inefficient products to green, efficient ones. And trying these ideas out at a local level before considering them at a national one makes sense.

New England’s has apparently already imposed a cap-and-trade system like that being considered at a national level. And it’s been wildly successful.

In 2009 ten states agreed to cap their emissions and created the nation’s first greenhouse-gas-emissions trading program. It auctioned allowances, created a carbon market and to date has sent $582 million into the coffers of participating states.

But before this started, the only example of a carbon cap-and-trade program was Europe’s, which had seen wild price swings and windfall profits for utilities. The stability of the Regional Greenhouse Gas Initiative, as New England’s cap-and-trade program is known, silenced those critics and placed it in the foreground of the national discussion on how to run these policies,” said Tom Tietenberg, emeritus professor of economics at Colby College in Maine.

“It’s been one of the primary reasons auctions are now prominently part of the (climate) bill.” Politicians, he added, have no problem spotting RGGI’s revenue. “It reduces the negative impact of a carbon bill.”

And there’s a number of other promising programs. My soon-to-be hometown of Austin has an “energy audit” required of all homes up for sale. That then gives the consumer an ability to factor in energy efficiency while shopping (my house got a fantastic audience, I say with not a small amount of pride). Denver’s trying to develop a large light-rail system, though monetary woes have put that in question.

The point I’d make with this is that these programs exist, but there’s not a lot of press coverage of them. Small successful projects like these should, it seems, be taking a much larger role in the conversation on climate change.

We focus all of our attention on the actions of the big – the climate change bill currently making its way through the Senate and the recent conference at Copenhagan. And that news can be pretty depressing.

But there’s a lot of promising efforts out there that, maybe, need a little more air time. I know this article lifted my spirits today.

So, if you see small stories like these, spread them widely. Evidence that climate change-based projects can work on a small scale will help to make sure that climate change-based projects happen on a large scale.

A Computer-Driven “Black Friday”?

The financial world is all abuzz with the stock market’s performance yesterday. The Dow dropped 9% in a matter of minutes, and then climbed back 6% in just a few more minutes.

No one really knows why yet. There’s rumors that it’s because of a typo – a trade for $16 billion that should have been $16 million. There’s also some pretty substantial evidence that computer programs played a role. Programs that were designed to automatically buy and sell stocks based on normal conditions went into a sort of “freak-out mode” when the typo occurred.

Kinda reminds you of 2001: A Space Odyssey, no? A supposedly smart computer run amuck?

Hits at some techno-rhetoric / technology theory stuff, too. A purely human-based system wouldn’t have freaked at a typo from “millions” to “billions” – and a purely computer-based system wouldn’t have made the typo in the first place. But when we mix the two, we get the potential for what just happened. Artificial intelligence isn’t to the point yet where it can anticipate situations like this. The algorithms just aren’t good enough yet (if they ever will be).

Also hits at just how fragile Wall Street wealth is. Accenture’s stock apparently dropped all the way to $0.01 a share during the flurry. Is that really a measure of the company’s value, or is it some arbitrary value determined more by the whims of traders?

Ah, well. I’ll just go home this evening and count the money that’s hidden under my mattress. Return on investment isn’t great, but at least it’s not subject to days like yesterday.

Forget the numbers?

Yet another post on what has become a near obsession of mine: how do experts communicate numbers to the public?

I’m still working my way through the Intro to Psych class from MIT that motivated the last post. But this post should be a bit more involved than that one. Right now I’m in Lecture 8, a discussion of how we think. What’s caught my eye in this one is the discussion that’s going on about how able we, humans, are to comprehend statistics and big numbers.

And, while the lecture is really just about the basics of this ability, its gotten me thinking about implications of the recognition that the human brain just isn’t wired to understand statistical probability or the implications of really big numbers. I’ve always thought that this was the case (lots of evidence from public understanding of evolution and astrophysics).  It’s comforting – though somewhat disturbing – for me to know that there’s a pretty solid psychological foundation for the concept that we have a really hard time grasping probability, weighing options based on big numbers, and understanding the concept of statistical outliers.

Apologies that I can’t provide better sources for the tests that follow. They’re from an audio file and my memory just isn’t good enough to catch the tests that the lecturer named. But look in this Intro to Psych course, lecture 8, about 30 minutes in if you’re interested (there’s also a PDF handout with some incomplete citations). The tests apparently netted more than one Nobel prize, so reliable stuff.

Comparing Numbers

Ok, so we’re all able to judge that 4 > 3, right? Hopefully? But apparently, we’re not very good at judging when one number is bigger than another when the numbers come from formulas. The test goes as follows:

Which of the following is more dangerous?

a) a program that has a 1/3 chance of killing 600 people

b) a program that will definitely kill 200 people

So, you do some quick math, and the number of people that will be killed in each case is exactly the same. But, when asked people will almost always pick option b.

Forgetting the Base Rate

This test looks at how good we are at determining the probable chance of something happening.

You meet Jack. Jack is a short, skinny, clean-cut man who loves poetry. He’s a self described feminist who is active in environmental causes. Is Jack more likely

a) a classics professor from an Ivy League school

b) a truck driver

Ok, we all say a, right? Thing is, when you factor in the base rate, it’s overwhelmingly b. Base rate is the total number of possibilities in the set (in statistical terms). Or, in layman terms, how many people you’re starting out with. There’s hundreds of thousands of truck drivers in the US. There’s maybe 100 Ivy League classics professors. So, the odds of Jack being a classics professor are just overwhelmed by the odds of him being a truck driver.

The Story Dwarfing the Numbers
(or, qualitative over quantitative)

Which are you more afraid of: driving a car or flying in an airplane? The airplane, right? Ok, now which is statistically more dangerous: driving a car or flying in an airplane? Actually, driving a car by pretty much any measurement out there.

Psychologists have some ideas on why this is. And while there’s a number of reasons, probably the strongest is the narratives that go along with plane crashes versus car crashes. Plane crashes make the evening news. They get investigated by Congressional commissions. Car crashes are mundane activities that may make page 14 of the newspaper. We hear about plane crashes more, so we’re scared of them more.

Telling Stories

So, how this plays out in real life is that when you’re convincing the populace of something, explaining the numbers rarely works.

Take the lottery, for example. Your odds of winning are infinitesimal. Yet, lottos make states enough money to fund entire school systems. Neil deGrasse Tyson, a science popularizer a la Carl Sagan, has a line that I love:

Lottos are a tax on those who failed statistics in high school

Las Vegas is a thriving economy for much the same reason.

But take the health care debate that (thankfully) just ended. It still stands out in my mind when ABC televised Obama’s town hall meeting at the start of the long hot summer of 2009. In the town hall, he tried very hard to explain the economics of his ideas – specifically why the public option was a good idea. He went through hard and soft dollars when calculating long term savings, exactly how much uninsured Americans cost insured Americans by adding to insurance premiums and hospital fees, and other numbers.

Then, a week later, the White House dropped the the tactic of explaining the economics of the proposal and instead framed the debate as an attack against evil health insurance companies. The reason, apparently, was that the American people just couldn’t grasp the economic/math stuff.

And there’s also the whole global warming thing. “Climategate” (which was recently debunked) supposedly was a case in which questionable research at one institution 25 years ago invalidated all global warming research. This is a case of the story dwarfing the numbers. There have been thousands of research projects which support anthropomorphic global warming. Invalidating one of those shouldn’t invalidate the other 999+.

Remember Snowpocalypse 2010? And remember the Fox News-types saying that a single massive snow storm invalidates global warming theories (when, in fact, it reinforces them)? Again, a story overwhelming the numbers.

Last example. State of the Union speeches always have the “hero” in the balcony next to the First Lady (ok, they’re really heroes, but you’ll see my point soon). They’re there to put a human face on a large statistical number. “Employment is up across the nation, as evidenced by Frank, sitting next to my wife.” “The stimulus bill has saved thousands of public jobs, as evidenced by Sarah, sitting next to my wife.” “Things are good because of me, as evidenced by” well, you get the point.

Don’t blame the schools

My first thought was to blame the school system. (why not, they’re an easy target) But, then, I asked myself: did we ever understand the numbers? Really, probably not. Could we ever understand the numbers? Really, probably not.

Schools try; teachers try. But you’re just fighting the hard wiring of the human brain here when you try to say,

Convince someone that just because their neighbor won the lotto while watching the results standing on their head doesn’t mean that they’ll win the lotto while watching the results standing on their head.

It may just be something we have to live with. People don’t like big numbers.

Forget the Numbers?

So, I’m left thinking:

People have a really hard time understanding numbers. People need to understand numbers to understand climate change, health care, education reform, global economics, immigration, mammogram screening policies, and evil aliens visiting Earth.

Uh oh.

How, then, do we communicate the importance and point of these issues to people who have a really hard time understanding the rationale behind them?

Well, we could keep throwing numbers at them until we both give up in disgust.

Or, we could do something productive like give them a story that exemplifies the point the numbers make.

Question comes up. Is it even worth giving them the numbers at all? Will providing the climate change data sets add anything to the argument that climate change will submerge New Orleans in 30 years? Will providing the data showing the vast connections between the Chinese and U.S. economies add anything to free trade arguments, more than showing Bob who now makes a living moving goods between the two countries?

I don’t think so. But, I think it’s important to include the numbers for ethical reasons.

The Ethics of Numberless Stories

Because if we leave out the numbers, then no-one has the ability to fact check the stories. And we can get into a contest of who has the better story. Whoever has the more sympathetic story wins the debate – not who has the better numbers.

There’s, I think, some discussion of this in Risk Communication literature. If any of you know of some, throw it my way, will you?

Is it unethical to use a compelling story to convince someone that something isn’t true? Seems like an easy answer: yes. But, is it unethical to use a compelling story to convince someone that something is true? If all you use is the story – if you omit the numbers – I’d have to say that’s an ethical gray zone.

Convincing someone that the stimulus package created lots of jobs because Mary in New York still has her teaching gig isn’t really convincing them with the facts, is it? It’s almost akin to convincing someone the sky is blue because grass is green. And convincing someone without facts, without logos and only with pathos or ethos, has always bothered me. It’s too close to manipulation.

So, if you want to convince someone that, say, the Earth really is warming, you need to give them the numbers and give them a story that demonstrates how the numbers play out. But if the numbers are never absorbed by your audience (if they never end up meaning anything), have you really communicated them? Sure, you spoke, but did they listen?

And if the numbers aren’t communicated, aren’t you essentially back to convincing someone solely with the story, and all the ethical quandaries therein?

I know the typical scientist’s response: the numbers are there. If they don’t understand them, that’s their fault. But I’m a rhetorician – I don’t like ineffective communication.

The Solution

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The Rhetoric of GM

I saw this commercial today on TV

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and thought it was an interesting rhetorical move

“A lot of Americans didn’t agree with giving GM a second chance”

Aren’t we, as a culture, all for giving somebody a second chance when they screw up? We’re supposed to recognize that everybody will mess up and be willing to give them a chance to redeem themselves. Kind of a Christian forgiveness thing.

The GM bailout, then, becomes giving somebody an opportunity to try again. Not a really expensive move to save an industry that committed a form of economic suicide via lethargy. (note, I’m a supporter of the GM bailout)

“We have repaid our government loan in full, with interest. Five years ahead of the original schedule”

Apparently, that statement can be called into question. But still, don’t we like people who meet their debts? And don’t we respect people who pay off their home mortgage early?

Cutting-edge Technology

And then, there’s the images in the background. A lot of people working, but they tend to be white-collar engineering types. Not blue collar assembly line workers. Maybe the jobs they want people to think they provide?

Take note of the shots you see of the cars, too. They tend to be really high-tech. There’s the plug-in electric car. The car on a giant pin cushion. The car zooming around a race track. None of the pick-up trucks you used to see.

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Really interesting commercial here. GM did a really good job invoking a number of images that Americans would like. The good guy who screwed up. The company who is pushing boundaries and creating jobs that are “respectable.”

And they’re not running from the past. They don’t try to cover up the bailout (though they never name the price tag). And they admit that people’s trust in them is seriously damage.

As a rhetor, I’ve got to say, “Kudos, GM”

Oh, how times have changed!

I got a request to do an entry on the Goldman Sachs “situation.” And I always listen to my fans, err, friends kind enough to read this regularly. Earlier today both the NYTimes and the Wall Street Journal have published lead stories about an SEC civil suit accusing the investment bank of directly manipulating the subprime mortgage market for financial gain.

The situation (as far as my non-economics brain can understand) is that Goldman Sachs promoted and possibly sold mortgage packages that it fully expected to collapse. Then, through the purchasing of derivatives, Goldman Sachs (GS) made substantial amounts of money when the mortgages went belly-up. In this way, GS made massive amounts of money by manipulating the market.

What fascinates me as a human being with ethical principles is that GS found it fully acceptable to manipulate the market in such a way that robbed investors of their money and fueled the sale of mortgages to individuals who couldn’t afford them.

What fascinates me as a rhetor is the public communications that surround this event. This story made the front page of two of the most respected publications in the world. It also headlined on the covers of USA Today, CNN, and CNBC (who used the title  “For some investors, another reason to distrust Wall Street” for their article). And it is a story that will be discussed around countless dinner tables tonight – especially as people pull out their 401k statements.

But if this story were to have happened 20 years ago (or, for that matter, 3 years ago), would it have gotten all of this attention? I don’t think so. Yes, it would have headlined on CNBC and most likely the WSJ, but USA Today and CNN wouldn’t have covered it.

The difference? The economy.

There has been a shift in the attention given to Wall Street, or more precisely to Wall Street’s misconduct on an order of magnitude from before the fall of Lehman Brothers. It’s not that Wall Street suddenly got less ethical since then (it can be argued that they’re actually more ethical). It’s that we suddenly care. Multi-million dollar bonuses existed long before the financial collapse and the bailout of AIG. Our attitude has just shifted. An example – Weekend at Bernie’s was on a couple weekends back. I had never seen it, so I watched it for a while. And I found it fascinating that the excesses of Wall Street that we now vilify were glorified in the movie. I remember watching Michael J. Fox’s The Secret of My Succe$s as a teenager and wanting to be an investment banker.

Now, TV shows are more likely to show CEOs of companies emptying port-a-potties than eating caviar in the back of stretch limos.

And I find it really refreshing. It’s nice to see the excesses of greed become socially taboo. I think we’ll all be a little better off if we’re a little less concerned with the size of our car.

Will it last? Actually, I’m doubtful. Once the economy stabilizes (as it’s appearing to), people will again turn to material goods as a motivation for their lives. And excesses of Wall Street will attract young people more than the Peace Corp will. But maybe we as a society will be a little more restrained after our current scare?

In the mean time, I’m really enjoying watching the two political parties fight over who’s going to stick it to Wall Street bankers harder.