I actually started gathering data on this a few weeks ago because I was tired of hearing conservatives rail against the poor (and implied lazy) as users of Medicaid. And then Paul Krugman wrote this nice article about it, though I wish he had included the actual numbers.
64% of the Medicaid budget goes toward care for the Aged or Blind and disabled (the CBO's categorization, not mine). That same category makes up 24% of the enrollment group. The thing that's eating up Medicaid dollars isn't poor folks, and it sure as hell isn't Mitt Romney's 47% - it's the nursing home for old folks that run out of money or the care for disabled folks that don't have a trust fund.
Average cost of a nursing home is over $50,000 per year. Let's start having honest discussions about these things. If you believe in slashing Medicaid, then you have to put this on the table. Do we just let old or disabled folks without funds wither or die without care? It sure is expensive, but thus far we've decided it's worth it. Deficit hawks need to be forced into this conversation, as it's a less comfortable one than railing against a grossly overstated population of lazy people that's sucking on government resources.
Wednesday, October 31, 2012
Thursday, July 5, 2012
The anti-stylus religion
"If you see a stylus, they blew it."
Very few of us really know exactly what Steve Jobs meant by that. This is the guy who asked why the heck you would want to watch video on an iPod screen the year before introducing the iPod that could play video. Clearly, his opinions were neither bulletproof nor set in stone, so let's examine this one up close.
People have been writing things down via pens or carving instruments for a few thousand years. No one utilized another way to record and store information at scale until the advent of printing. Kids in schools still do 95% of their work with pen and paper, and any scientist or mathematician will tell you that they spend lots of time working on paper or white board before formalizing things in TeX. I work at a company whose business is technology, and I *still* find pen and paper to be the most efficient means to record information for a good portion of my day.
Writing with a pen or marker is comfortable and quick, and it frees you to form whatever characters or shapes you need to record. Writing with a pen isn't the best tool for writing a blog post (I'm tapping this one out on my iPad screen), but it's probably the best tool for drawing or diagramming. And what if software can start to smooth out the rough edges of diagramming that I do with a pen? What if software can help me convert my drivel to TeX quicker than writing the code on a keyboard? If someone can make that software for the iPad or the Nexus 7 and sell me a stylus with it, I'll buy it in a heartbeat.
A stylus is not a perfect input device for text. But a keyboard or a touch screen isn't a perfect input device for lots of other things, either, like sound or drawn line, but we still think that computing devices need them. People who write code or blog posts all day seem to think that most people's work is about writing text in blocks. It's not. Should doctors really spend their day jumping between form fields on their iPad chart app, waiting for the virtual keyboard to animate up and down on each one before moving their hand to tap out a word or a sentence? A stylus just might be an awesome input device for a lot of tasks that require short bursts of unstructured written input.
Lose the anti-stylus religion, folks. No one has figured out a single perfect input device for all things, and when someone cracks the challenges of the stylus, it has a great chance to be a powerful input device in its own right.
Very few of us really know exactly what Steve Jobs meant by that. This is the guy who asked why the heck you would want to watch video on an iPod screen the year before introducing the iPod that could play video. Clearly, his opinions were neither bulletproof nor set in stone, so let's examine this one up close.
People have been writing things down via pens or carving instruments for a few thousand years. No one utilized another way to record and store information at scale until the advent of printing. Kids in schools still do 95% of their work with pen and paper, and any scientist or mathematician will tell you that they spend lots of time working on paper or white board before formalizing things in TeX. I work at a company whose business is technology, and I *still* find pen and paper to be the most efficient means to record information for a good portion of my day.
Writing with a pen or marker is comfortable and quick, and it frees you to form whatever characters or shapes you need to record. Writing with a pen isn't the best tool for writing a blog post (I'm tapping this one out on my iPad screen), but it's probably the best tool for drawing or diagramming. And what if software can start to smooth out the rough edges of diagramming that I do with a pen? What if software can help me convert my drivel to TeX quicker than writing the code on a keyboard? If someone can make that software for the iPad or the Nexus 7 and sell me a stylus with it, I'll buy it in a heartbeat.
A stylus is not a perfect input device for text. But a keyboard or a touch screen isn't a perfect input device for lots of other things, either, like sound or drawn line, but we still think that computing devices need them. People who write code or blog posts all day seem to think that most people's work is about writing text in blocks. It's not. Should doctors really spend their day jumping between form fields on their iPad chart app, waiting for the virtual keyboard to animate up and down on each one before moving their hand to tap out a word or a sentence? A stylus just might be an awesome input device for a lot of tasks that require short bursts of unstructured written input.
Lose the anti-stylus religion, folks. No one has figured out a single perfect input device for all things, and when someone cracks the challenges of the stylus, it has a great chance to be a powerful input device in its own right.
Monday, May 14, 2012
The problem with ending the patent system
On Episode 67 of Hypercritical, excellent and exhaustive complainer John Siracusa presented an argument for entirely ending the patent system. While I agree with him that software patents are a sham, that many other patents stifle innovation (Nest's legal troubles, anyone?), and that many industries would be better off without spending hundreds of millions on legal battles, there are many problems with just abolishing the patent system. John addressed some of them, but he left one gaping issue unmentioned and unrefuted.
Abolishing the patent system would be the largest government seizure of property since 18641. Say what you'd like about the nasty business of patent trolls, but they acquire their war chests by paying inventors for patents. Making those patents worthless is tantamount to busting down the doors of their banks and emptying their accounts. We want to make our country a great place to innovate and do business, but doing so with one hand and robbing businesses with the other runs counter to that.
This is not an easy problem to solve. There are two options:
1) Let existing patents live on, and stop granting new patents.
This option does nothing about all the bogus patents that are out there today. And it would take 14 to 20 years for patents to be phased out, with the legal battles lasting for at least that long while companies tried to milk their patents for all their value. Still, it's a simple long term solution.
2) Compensate patent holders for their loss.
This one is really sticky, but it's a Pareto improvement if you can accurately price them. Consumers (~taxpayers) compensate the companies, and as a result the price of goods drops because the cost of competing becomes lower. Accurately pricing patents is hard, though. Really hard. Most are worth almost nothing, but some are worth millions. With over 100,000 patents issued per year, pricing the active patents becomes its own nightmare. If anyone can come up with a viable scheme to do this accurately and cheaply, it's an incredibly valuable idea. One that they should patent.
If we do kill the patent system, it's going to take at least 15 to 20 years. Or we're going to rob a lot of American business owners. Either way, we're likely to be paying billions of dollars to lawyers for the forseeable future. Do yourself a favor and either become one of them or hire one to file a patent on your next big software idea.
(1) That example also makes clear that such a seizure might, potentially, be an awesome idea. Paying off all the plantation owners for the slaves might have saved a lot of death and destruction, achieved the same end of freedom for enslaved people, and been cheaper than the Civil War. I'm not sure if this was proposed at the time, as my only memory of this idea is based on a college history professor who posed the hypothetical. If there's an academic literature on this, can someone share it with me?
Abolishing the patent system would be the largest government seizure of property since 18641. Say what you'd like about the nasty business of patent trolls, but they acquire their war chests by paying inventors for patents. Making those patents worthless is tantamount to busting down the doors of their banks and emptying their accounts. We want to make our country a great place to innovate and do business, but doing so with one hand and robbing businesses with the other runs counter to that.
This is not an easy problem to solve. There are two options:
1) Let existing patents live on, and stop granting new patents.
This option does nothing about all the bogus patents that are out there today. And it would take 14 to 20 years for patents to be phased out, with the legal battles lasting for at least that long while companies tried to milk their patents for all their value. Still, it's a simple long term solution.
2) Compensate patent holders for their loss.
This one is really sticky, but it's a Pareto improvement if you can accurately price them. Consumers (~taxpayers) compensate the companies, and as a result the price of goods drops because the cost of competing becomes lower. Accurately pricing patents is hard, though. Really hard. Most are worth almost nothing, but some are worth millions. With over 100,000 patents issued per year, pricing the active patents becomes its own nightmare. If anyone can come up with a viable scheme to do this accurately and cheaply, it's an incredibly valuable idea. One that they should patent.
If we do kill the patent system, it's going to take at least 15 to 20 years. Or we're going to rob a lot of American business owners. Either way, we're likely to be paying billions of dollars to lawyers for the forseeable future. Do yourself a favor and either become one of them or hire one to file a patent on your next big software idea.
(1) That example also makes clear that such a seizure might, potentially, be an awesome idea. Paying off all the plantation owners for the slaves might have saved a lot of death and destruction, achieved the same end of freedom for enslaved people, and been cheaper than the Civil War. I'm not sure if this was proposed at the time, as my only memory of this idea is based on a college history professor who posed the hypothetical. If there's an academic literature on this, can someone share it with me?
Sunday, April 15, 2012
On our privacy
My mother forwarded me an email recently with a link to a local news story. It warned, in grave terms, that your geotagged photos from your iPhone were revealing where you live and where your kids go to school. Anywhere you take pictures, you could be exposing your child to a predator! Whoa! Turn off geotagging!
But wait a second, isn't there another way to find out where you live? Oh, that's right - the phone book. And what about the school where your child goes? Well, if you live in a small town, there's probably only one school that they go to. Otherwise, is it really sensitive information where your child attends? If a predator is after your particular child, you'll have bigger worries than their discovering where he or she goes to school. We can't hide where the schools and playgrounds are because we have no idea who to hide them from and because parents can be predators, too. You won't keep that information private, so there's no reason to pretend you have control.
The reality is that much of this kind of privacy has not existed in our lifetimes and probably even less so before that. It's a recent development for us to even think so critically about privacy, because it used to be simple - you might have had a single private space in your home, and if you lived in a city you had some moderate anonymity in public. Even that wasn't necessarily true; ask my grandmother what kind of privacy her family had in the tenement apartment her family shared on the Lower East Side in the 1920s. As our worlds have grown larger in scope but smaller in accessibility, we've had the luxury of worrying about who knows what about us.
So rewind 30 years, before the emergence of personal computing and before Twitter and Skype. When you walked into a department store and signed up for a charge card, they took down all of your information. And they kept track of the things you bought. Did they keep this all private? No way! They turned around and sold it to a marketer for a couple of bucks. The marketer sent you brochures and circulars, and they called you at home during dinner to sell you mail-order frozen steaks or Hawaiian vacations. And they sold your information to every other marketer that would pay them a buck for it.
So what's your grocery store's privacy policy? What about your plumber's privacy policy, or your realtor's? And what about the woman who works the pastry counter at your favorite cafe - will she out you for your lemon bar addiction when you come in with a date? Tons of data is out in the world about you, both structured and unstructured. You are a walking, talking privacy disaster, and there isn't a damn thing to be done about it without retreating into some kind of self-sufficient wilderness life. And we haven't even talked about the Internet yet!
The accessibility of search and social media have made us all aware of how much data are being gathered about us and being used, both for products and to serve us targeted ads. But the great thing is that we've set expectations that each one of them needs to publish and stick to a privacy policy. And we have the right to read it, pick it apart and yell at them about it, or choose not to use a business whose policy we don't like. This is a huge leap in the transparency of how our data is being used! The Internet titans are way more transparent than their brick and mortar cousins. I know much better what Amazon is doing with my data when I search "paper towels" than I do when when I buy them in person at Joe's Paper Towel Emporium.
In addition to easily accessible privacy policies, the other advantage of Internet data use is that the big companies we care most about are not going and selling our data to advertisers and marketing agencies. Facebook is very happy to allow an advertiser to show their ad only to 25-year olds who are engaged and living within 20 miles of Philadelphia. But Facebook does not hand the advertiser a list of those people. That's the deal we get on the Internet. And it's way better than the one we get from the tangible world around us.
But wait a second, isn't there another way to find out where you live? Oh, that's right - the phone book. And what about the school where your child goes? Well, if you live in a small town, there's probably only one school that they go to. Otherwise, is it really sensitive information where your child attends? If a predator is after your particular child, you'll have bigger worries than their discovering where he or she goes to school. We can't hide where the schools and playgrounds are because we have no idea who to hide them from and because parents can be predators, too. You won't keep that information private, so there's no reason to pretend you have control.
The reality is that much of this kind of privacy has not existed in our lifetimes and probably even less so before that. It's a recent development for us to even think so critically about privacy, because it used to be simple - you might have had a single private space in your home, and if you lived in a city you had some moderate anonymity in public. Even that wasn't necessarily true; ask my grandmother what kind of privacy her family had in the tenement apartment her family shared on the Lower East Side in the 1920s. As our worlds have grown larger in scope but smaller in accessibility, we've had the luxury of worrying about who knows what about us.
So rewind 30 years, before the emergence of personal computing and before Twitter and Skype. When you walked into a department store and signed up for a charge card, they took down all of your information. And they kept track of the things you bought. Did they keep this all private? No way! They turned around and sold it to a marketer for a couple of bucks. The marketer sent you brochures and circulars, and they called you at home during dinner to sell you mail-order frozen steaks or Hawaiian vacations. And they sold your information to every other marketer that would pay them a buck for it.
So what's your grocery store's privacy policy? What about your plumber's privacy policy, or your realtor's? And what about the woman who works the pastry counter at your favorite cafe - will she out you for your lemon bar addiction when you come in with a date? Tons of data is out in the world about you, both structured and unstructured. You are a walking, talking privacy disaster, and there isn't a damn thing to be done about it without retreating into some kind of self-sufficient wilderness life. And we haven't even talked about the Internet yet!
The accessibility of search and social media have made us all aware of how much data are being gathered about us and being used, both for products and to serve us targeted ads. But the great thing is that we've set expectations that each one of them needs to publish and stick to a privacy policy. And we have the right to read it, pick it apart and yell at them about it, or choose not to use a business whose policy we don't like. This is a huge leap in the transparency of how our data is being used! The Internet titans are way more transparent than their brick and mortar cousins. I know much better what Amazon is doing with my data when I search "paper towels" than I do when when I buy them in person at Joe's Paper Towel Emporium.
In addition to easily accessible privacy policies, the other advantage of Internet data use is that the big companies we care most about are not going and selling our data to advertisers and marketing agencies. Facebook is very happy to allow an advertiser to show their ad only to 25-year olds who are engaged and living within 20 miles of Philadelphia. But Facebook does not hand the advertiser a list of those people. That's the deal we get on the Internet. And it's way better than the one we get from the tangible world around us.
On driving your car with a manual transmission
Call for volunteers: we need someone in New York willing to teach Marco Arment to drive stick.
Marco talked on this week's Build and Analyze After Dark about his preference for stick shift and how he was impressed by an automatic transmission with a manual mode and paddle shifters. He also told us that he's "generally OK but not amazing" at driving stick and that he only stalls once in a while. He asserted that his wife would be happier with an automatic because his driving would be less jerky. Marco, I'm sorry to say that you might be a bit worse at all of this than you think. Here's why:
I'm also no expert on driving stick, but I know as much as I've learned driving stick since I first learned to drive. Please, someone help Marco fix what he's doing wrong. We can't afford to lose too many more enthusiasts in the US before they start forcing us all to drive those giant Go Karts that everyone else drives.
Marco talked on this week's Build and Analyze After Dark about his preference for stick shift and how he was impressed by an automatic transmission with a manual mode and paddle shifters. He also told us that he's "generally OK but not amazing" at driving stick and that he only stalls once in a while. He asserted that his wife would be happier with an automatic because his driving would be less jerky. Marco, I'm sorry to say that you might be a bit worse at all of this than you think. Here's why:
- A car properly driven with a manual transmission should be no more jerky than one with an automatic transmission. Unless you're equating fast acceleration to jerkiness, in which case the experiences would be the same, jerky manual transmission driving sounds like a symptom of giving too much gas while letting out the clutch, not easing off the gas before pushing it in, or both.
- I live in San Francisco, land of many hills, and I can count on one hand the number of times I have stalled in the past 5 years. If you're stalling in any way other than in weird cases where you were in gear and didn't realize it, you need some more help with starts.
- The value of a manual transmission is partially being able to shift when you'd like, and paddle-shift automatics do provide that service, but the real value of a manual transmission is being able to control exactly how much power goes down to the wheels. It's the clutch. You have very fine control of the connection between the engine and the wheels when you drive stick, and that's especially useful at times when you have poor traction (like, perhaps, driving on snowy hills in Westchester).
I'm also no expert on driving stick, but I know as much as I've learned driving stick since I first learned to drive. Please, someone help Marco fix what he's doing wrong. We can't afford to lose too many more enthusiasts in the US before they start forcing us all to drive those giant Go Karts that everyone else drives.
On RIM's acceleration toward insignificance
RIM has a new series of ads on buses and subways - they picture very serious people who look like they do very serious things for a living. These people glare out of their posters with their arms crossed or hands busy with something more important than anything you do. They're captioned, "I'm not interested in down time," like the rest of us who enjoy other stuff on our phones are just idiots who do nothing.
Somehow, RIM has completely missed the reason that they have been unsuccessful in the past five years. The very serious people in their ads are exactly the people that used to use Blackberry devices and made them the market leader in smartphones for years. Those people switched devices. They started bringing iPhones and Android phones into work and asking IT if they could use them. Blackberry is trying to convince the people that used to love Blackberry that they really want the same experience they had five years ago, but the reality is that the rest of the world moved on. People want personal email, games, Twitter, and Instagram on their phone, regardless of whether they use the same device for sending work emails and calendar invites.
If this is RIM's idea of focusing on the enterprise, they may as well pack it in and cash out the shareholders. When customers demand a better experience, the answer is not to double down and convince them that they misunderstand the experience that they really want. That's a losing game plan.
Somehow, RIM has completely missed the reason that they have been unsuccessful in the past five years. The very serious people in their ads are exactly the people that used to use Blackberry devices and made them the market leader in smartphones for years. Those people switched devices. They started bringing iPhones and Android phones into work and asking IT if they could use them. Blackberry is trying to convince the people that used to love Blackberry that they really want the same experience they had five years ago, but the reality is that the rest of the world moved on. People want personal email, games, Twitter, and Instagram on their phone, regardless of whether they use the same device for sending work emails and calendar invites.
If this is RIM's idea of focusing on the enterprise, they may as well pack it in and cash out the shareholders. When customers demand a better experience, the answer is not to double down and convince them that they misunderstand the experience that they really want. That's a losing game plan.
Monday, February 6, 2012
On paying Foxconn workers like Americans and paying Harvard grads to gamble on credit
Much has been made of the NYT story that ran last week on the conditions for workers at Foxconn and the meager pay. To put aside, for a moment, the issues of the Chinese government addressing the health and safety of its own people, I want to examine the idea that one solution is for Apple to better pay the employees in their factories, perhaps at the rate of American factory workers. Maybe the employees would need to work less, or maybe they would be happier to work the long hours, or maybe they would get massages with their outsized salaries in order to offset their long working hours. Sounds great.
Apple profits would drop, which isn't a big deal at the moment but would have been a death sentence in 1997. We could pretend that they are so well run that they won't ever see tough times again, and we'd pat ourselves on the back for having pushed this profitable company to give away its profits for nothing in return. But what would the effect be on the larger labor market in China?
Apple profits would drop, which isn't a big deal at the moment but would have been a death sentence in 1997. We could pretend that they are so well run that they won't ever see tough times again, and we'd pat ourselves on the back for having pushed this profitable company to give away its profits for nothing in return. But what would the effect be on the larger labor market in China?
- In the aggregate, nothing. About a million people work for Foxconn, and less than 25% of those are making Apple products. 250,000 people in a population of over 1,000,000,000 is a small drop in a very large bucket.
- For those 250,000 jobs, competition would become fierce. People in traditionally higher paid professions (teachers, doctors, and engineers) would leave their chosen profession for jobs putting together iPhones. In a country that, only 40 years ago, was in worse shape than Africa, telling the expanding middle class that working in factories is the most valuable use of their time seems like a step backward. More on that ahead.
- If Apple were to hit tough times - a lull in innovation or a sudden drop in demand for one of their products - they might no longer be able to compete with the Samsungs and LGs of the world, and they would need workers that they could pay at the same competitive rate as those competitors. Wages are sticky, so they would need to lay off workers and hire new ones. The cash pile would be gone and we'd be back where we started, except that a small group of workers had a temporary bump in pay.
Don't get me wrong - it's not ideal that these workers make $22/day working long shifts with little leisure time. However, it's a) better than having no job or a job in agriculture on land that is exhausted, and b) a problem best solved by time and public policy. Apple can continue to fight to improve things for the workers in its supply chain, and it will likely continue to be thwarted by companies that demand a premium for it and then deliver on none of it anyway, because they aren't held to any of the standards by their government. China may need to solve this one on its own, and companies that try to stand up to the Chinese government rarely find success.
This all got me thinking about another industry where I believe workers have been overpaid, and where the smartest people fight like dogs for the best positions instead of doing something that creates value. Our top college grads go into the most lucrative field there is - finance. In the last decade, far more compensation money has come out of Wall Street and into workers' pockets than has been created for our economy.
Finance provides banking (a safe place to keep your money and earn modest returns on it), investing and hedging (a way to shift risk from people who want it to people who don't), and funding for businesses via loans, bond markets, equity markets, and private equity. All of those things are good, and all of them are things that our economy can't live without. However, none of them should involve tons of risk or tons of reward; banking is an old profession and a boring one. You borrow money from depositors at a lower rate of interest than you lend it to creditors, and you pay yourself and insure yourself on the spread. It should be competitive, boring, and anything but lucrative. Monkeys that do math could be bankers.
Enter complex financial instruments, greedy investors, and as much leverage as you want. People with money wanted geniuses to park it with who would claim that their black box would spit out tons of money in the future. The Harvard kids quickly realized that someone was willing to pay them hundreds of thousands of dollars per year to create such black boxes and sell slices of them at great profit (oh, and keep some slices for the banks - we can thank those slices for the bailouts that were required). This had little to do with reducing risks for investors or providing finance to businesses, and a lot to do with bonuses and paychecks on the backs of investor zeal for assets that they wished were worth much more than they were.
So in piled the Harvard kids (and all the other smartest kids - I don't mean to pick on Harvard here). The financial crisis and economic downturn aside, this was the grandest tragedy of the Wall Street boom in the last two decades. Thousands of people who could have been developing cancer drugs, software to make cars safer, or businesses to deliver fresh produce most efficiently, were instead figuring out how to sell garbage to people hoping to make a buck. Finance has a place for 5% of Harvard's graduating class. It shouldn't have a place for 30% of them.
So should Apple pay Foxconn workers what they would pay American workers? Only if we want the best and brightest Chinese students to spend their days in factories putting together iPhones. I, personally, would rather they start the businesses and do the research that will allow the 2 billion Chinese workers of the next century to have the working conditions that we'd like to give to 250,000 of them today.
Update: This is happening. Americans now get to be relieved of their guilt while using their iPads, the average Chinese worker is not better off, and more high-skilled Chinese workers are utilizing fewer of their skills in order to divert themselves into making iPads for high wages. Thanks, America.
Update: This is happening. Americans now get to be relieved of their guilt while using their iPads, the average Chinese worker is not better off, and more high-skilled Chinese workers are utilizing fewer of their skills in order to divert themselves into making iPads for high wages. Thanks, America.
Wednesday, February 1, 2012
A Place to Share My Obnoxious Opinions
Every day, I read hundreds of blog posts about the latest news in technology, education, business, and economics. I'm addicted to this information, and my ambition in life is to make the first three of those suck a little bit less. So, naturally, I need a spot to rant.
Marco Arment talked a lot on Episode 59 of Build and Analyze about the death of blog comments. You can listen to the show for his explanation of this, but basically, while some commentary on blogs has value, most of it is garbage. These days, the way to offer commentary on an issue is to create your own space for it. If it doesn't suck, people will link to it and read it. If it does, they won't. That sounds fair to me.
So this is my space for discussing the things that matter to me. Read it if you think my opinions don't suck, and feel free to completely trash my obnoxious opinions in your own forum. Few things are as fun or productive as a healthy argument.
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