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If I could add one required course to every student's education, it would involve learning the skill of comparing.  You might think that comparing alternatives is the domain of common sense, but it isn't. It takes actual training. People who study law, engineering, economics, psychology, and business get different subsets of that training. But many people get none. And it's one of the most important skills that we humans need. Every decision involves some sort of comparison.

In our current system, the skills you need to compare alternatives are broken into little pieces and spread across several disciplines. A business student might learn about the time value of money while the psychology student is learning about confirmation bias. The math major is studying statistics while the religion student is learning that people will believe just about anything if the context is right.

My hypothetical curriculum for a course in Comparing might include the following topics:

Sunk costs

Time value of money

The illusion of fairness

Evaluating risk

Considering the source of the information

Considering the wider context

Limits of human perception

Statistics (basic)

Cognitive dissonance

Confirmation bias

Famous Lies and Hoaxes

If I may overgeneralize for a moment, most disagreements have at their core one or more of these four basic causes:

1.       People have different information

2.       People have different selfish interests

3.       People have different superstitions

4.       People have different skills for comparing

Of the four causes for disagreement, one is king over the other three. People with strong skills in comparing alternatives can quickly identify in each other where they have differences in information and in selfish interests, and that can be enough to suggest ways to reach agreement, or at least accommodation. (People with skills in comparing generally don't engage in debates about superstition.)

Lacking the basic skills needed to compare alternatives, two people with different information and a couple of drinks can argue all night long and produce nothing but bad feelings. The same goes for people with different selfish interests and different ethical/moral standards.  But people with good comparison skills can quickly find common ground. In our increasingly complex world, where different cultures are colliding, we'll all need a lot more talent for making the right comparisons.

Consider the budget debate in the United States. Every knowledgeable observer recognizes that the solution involves both deep cuts in expenses and higher taxes on those who can afford it. And yet our elected officials have framed the issue as one of higher taxes or not, and budget cuts or not. Politicians get away with false comparisons because the majority of voters are not trained in the skill of comparing.  Borrowing a strategy from Gandhi, we need to become the change we seek in the government. Leaders will only make rational comparisons, and therefore rational decisions, when they know that the voters can tell the difference.

 
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+1 Rank Up Rank Down
Feb 27, 2011
Good idea, I'd suggest that to take it to the next level you set up a WIKI site, there are a few that are either free or low cost, and see if your readers would be interested and "rational" enough to develop the "text book" for such a course.

If you have some free time, you might write/build the first section so that the others would have a starting point for the type of material that you think might be included and the structure of the text.

Note: I am not sure how you would want to treat the CopyRight, but I expect that most of us would be quite willing to sign over rights to you in payment for the idea and the time that you may have to spend to guide it's development.

 
 
-6 Rank Up Rank Down
Feb 1, 2011
Why does the budget need to be balanced and the national debt (= private sector savings) reduced?
 
 
+1 Rank Up Rank Down
Jan 30, 2011
And this is why I served as a union shop steward, but ended up hating both management and the union with equal passion. Both have their own self-interests at heart, both will fudge the facts at every available opportunity, and each thinks they have more power than the other. Neither was interested in a fair agreement, only in pushing their own agendas in order to "win".

Seems to me the same thing has been happening in politics for some time now. No one in power wants a fair debate based on rational ideas, because no one thinks it's possible for his side to win without the other side "cheating", i.e. influencing the lowest common denominator of voters with emotional arguments instead of logic. Is the majority of voters smart enough to know the difference? The ruling elite say no, and it looks like they might be right. It's up to the great unwashed to get smart, or at least informed, and storm the Bastille. Tunisia and Egypt have more in common with us than we might like to think.

 
 
+10 Rank Up Rank Down
Jan 30, 2011
Scott said: "Here's a Wikipedia article with links arguing that the evidence for school vouchers is weak to none: http://en.wikipedia.org/wiki/School_voucher"

I'm not sure what you mean, Scott. Evidence of what?

I have a son in fourth grade. I pay thousands per year in school taxes. And then I pay thousands more in private school tuition because the public school education that I'm forced to pay for is completely unacceptable. What evidence do YOU have that I should have to pay twice for my son's education?

Do remember the old telephone monopolies? Imagine that they're still around. And then imagine that the law requires you to pay for a land-line, not matter what. Then after you're done paying for your land-line, the goverment will permit you to pay extra for a cell phone. That's public education in America.

Do you really need much evidence to conclude that people shouldn't be forced to pay for a service that they don't want to use? And wouldn't you expect a monopolist to fund endless studies warning of the dangers of breaking their lucrative monopoly?
 
 
+4 Rank Up Rank Down
Jan 28, 2011
What is lacking from the "balance the budget without raising taxes" illustrations is what we are getting for our money. We have some debt now and it takes X% of our revenues to pay for it. If we balance the budget by 2020 using the Cato model given by scottn (
http://www.cato-at-liberty.org/its-simple-to-balance-the-budget-without-higher-taxes/ ), what does X change to? We'd still be adding debt until the budget is balanced and that added debt comes with interest. It also limits Medicare/Social Security other promised entitlement spending to inflation increases. What would that mean for the people in those programs and all the new people becoming eligible for the program? What discretionary programs get dropped to make space for this additional required spending?

I find those models so simplistic as to be useless. Plotting two lines and showing when they cross tells little of value. It leaves out all the details, all the personal impacts that make such plans politically impossible to implement, while allow the "planners" the step back, brush the chalk off their hands and proclaim, "Done. You're welcome." The problem is not simplistic. The solution will not be either.
 
 
Jan 28, 2011
1. Teachers need to only teach skills to compare. I believe teachers already know how to teach these subjects. It's just that they are spread in various disciplines. I believe that's Scott's point. Application of those concepts will be on students. E.g. Einstein's teachers probably taught him basic concepts but were not as GOOD as him....:)

2. If government reduce spending and get out of the way of businesses (rich?) everything will be fine....Let's see how that works....

I have rudimentary heating system at my house which is basic form of feedback system. This simplest system doesn't work!!! I leave it alone and don't spend any money on it but damn thing won't work correctly. One room gets very hot and other stays as cold as morgue. Technician who came to look at it toldl me I need to fix it by making sure feedback is at correct point and controller need to be more smarter. He also made comment government need to get out of the way of businesses and let just market work....

Now I am not economist, businessman or technician. But I did study feedback systems in engineering school. And I understand economy is like huge feedback system (let's say a billion times more complex system than heater in my house..) Listening to economist and politicians (ofcourse!)
1. we don't understand whether feedback we get from economy is reliable
2. we don't understand accurately what are the delays involved in that feedback
3. we don't understand if out corrective actions (Gov free market) work well on not
4. we don't understand if any corrective action works sufficiently rapidly or not.

Yet, people are convinced all we need to do is sit back, relax and have some cool-aid...
 
 
+2 Rank Up Rank Down
Jan 28, 2011
Actually, here is a much more detailed plan to balance the budget without raising taxes.

http://www.downsizinggovernment.org/balanced-budget-plan
 
 
0 Rank Up Rank Down
Jan 28, 2011
Scott, you asked for a link that showed how to balance the budget without raising taxes. Here you go:

"If spending is simply capped at the current level with a hard freeze, the budget is balanced by 2016. If we limit spending growth to 1 percent each year, the budget is balanced in 2017. And if we allow 2 percent annual spending growth – letting the budget keep pace with inflation, the budget balances in 2020."

http://www.cato-at-liberty.org/its-simple-to-balance-the-budget-without-higher-taxes/

[I'll bet those numbers are right. But misleading. To oversimplify my point, if the number of retirees goes up 30% in a few decades, but the funding of Social Security stays flat, and we consider inflation, you'd cut the amount of Social Security available per person by maybe 40% and push tens of millions of the elderly into starvation and homelessness. I think everyone agrees that the math of cutting the budget and not raising taxes to solve the deficit works just fine. But the relevant comparison (back to my theme) involves projecting how the country turns out after keeping the budget flat. If that choice isn't practical, it's not a real choice. -- Scott]
 
 
Jan 28, 2011
Scott,

Would balancing on the horns of a dilemma be part of your course on comparing alternatives? That’s the skill that’s needed when all the alternatives you’ve identified have serious negative consequences. Your combination of “deep cuts in expenses and higher taxes on those who can afford it” that “every knowledgeable observer recognizes” is an example: Try to avoid throwing too many government workers onto unemployment, having too many people lose their homes, or having the flight of wealth from NY State replicated nationally. But so is borrowing money and putting the problem off until the economy is stronger.

I think the despised strategies of “muddling along,” “papering over the problem,” and “buying time” are rational responses to choosing an alternative now that you know is bad. The future may be different. The Soviet Union fell without a third world war. Peace broke out in Ireland. New reserves of natural gas may get utilities off the horns of the nuclear-or-coal dilemma. Facebook may change the government of Egypt.

There was a scene in an episode of the TV show, The West Wing, a few years ago. An older presidential advisor asked a younger advisor something like, “You’re one of the big minds of your generation. Do you see any way out of the deadlock in the Middle East?” The answer was something like, “No. But as long as there’s a deadlock, there’s still a chance someone will.”

Is it part of your course to learn that the future won’t necessarily look like the present?
 
 
+1 Rank Up Rank Down
Jan 28, 2011
I hope everyone can appreciate the disdain the wealthier among us has for the poor because they don't pay taxes or pay very little. How can you be envious of someone who:

a.) Struggles to put food on the table each night
b.) Is largely ignored when it comes to public schools for their children
c.) Lives in high crime areas where everyone has friends/family who were murdered, whether innocent or not
d.) Goes bankrupt and dies when they get sick


I also appreciate how the rich assume that the poor are stupid, lazy or addicted to drugs. In reality most are unfortunate, not born to wealthy parents or descendants of former slaves (yes, slavery ended 150 years ago, but blacks didn't have rights until the '60s and are still often discriminated against). If all the poor people were born to wealthy suburan parents, went to top 10% performing public schools, got put through college (at least partially) by their parents, 90% would do just as well as the rest of us. Plus, many rich people get that way by exploiting the middle class and poor people, so they should stop complaining about having to support them.

Lastly, if todays tax rate is too high, there wouldn't be a record number of rich people (to go with the record number of poor people):

http://www.usatoday.com/money/economy/2010-09-28-census-income-gap_N.htm
 
 
+2 Rank Up Rank Down
Jan 28, 2011
I've been trained to compare objects since I can remember. School taught me to compare writting to deterime which better represented the point the author wanted to make. Home taught me to compare prices, offers of employment, religious statements, and political policies. My adult learning experiences were in Computer Science (really just a math major with computer programming classes thrown in) and Business Operations Management. My military carrer taught me to make snap comaparisons in combat and to think on my feet. Out of boredom one year, I took classes on game theory, philosophy, psycology, and socialogy. The total upshot is that all of that covers what Scott recommends for comparison training. The problem is, deciding how to compare things when the situation arises. Other than snap decisions, I spend more time deciding how to compare things than doing the actual comparison. I will admit, that my decisions tend to be sound - if you can wait a few days. This world seems to be all about NOW and so I tend to make a lot of snap decisions. They don't work out so well, unless I am in an emergency situation.

To summarize, I think that if Scott acutally was able to take and teach the entire syllabus listed above, you would end up with a number of people who would embody "analysis paralysis" and nothing would get down. Oh wait, we already have a body in this country that suffers from that - Congress!
 
 
Jan 28, 2011
Shamelessly Off Topic: Didja know when one tries to share this link on facebook, it just comes out with an extremely long URL - other sites easily show the titles in bold and with a thumbnail. Love your stuff, just please make your links more fb user friendly, in order to spread the gospel of Dilbert. Thanks!
 
 
Jan 27, 2011
"Every knowledgeable observer recognizes that the solution involves ... higher taxes on those who can afford it." Here's what a Nobel Prize Winning Economist says:

Interviewer: Why don't we just have exorbitant taxes on the rich and minimal taxes on everyone else? What would that do to the economy?

Milton Friedman: That would eliminate the rich.

Interviewer: Right. Would it have a negative effect on economy overall?

Milton Friedman: Well, who would provide the funds, the capital, and the entrepreneurship for the new industries?

[We already have exorbitant taxes on the rich, and yet we still make more of them every day. But I assume Friedman was talking about something more like a 90% tax rate than a 50ish% rate. -- Scott]
 
 
0 Rank Up Rank Down
Jan 27, 2011
For those of us that would remind Scott that we have a Constitution in this country that is supposed to be the supreme law of the land, Scott replies:

[You would make your budget decisions based on the ideas put forth hundreds of years ago by slave-owners who pooped in holes. That strikes me as not even trying to look at the problem in a practical way. -- Scott]

Fair enough. But Scott, if your position is that the Constitution is out of date, there is a solution. Amend the Constitution. (There's a reason that it's not easy to do, but it is certainly possible, and has been done 27 times). But supporting programs that are currently unconstitutional simply because you feel the document is flawed is the same as committing a crime and justifying it by simply saying you disagree with the law.

By the way, you haven't provided links (as you expect your commenters to do) showing evidence that there's anything wrong with the Constitution as written (at least, for the most part), just because it was written by slaveowners that didn't have the benefits of modern plumbing. You're certainly entitled to that opinion, and granted, this is your blog, you can say whatever you want. But this would probably be a more productive conversation for everyone if you held yourself to the same standard....

[The people who WROTE our frickin' constitution were actively violating laws they disagreed with, e.g. The Stamp Act, the Townsend Act, The Coercive Acts. -- Scott]
 
 
Jan 27, 2011
In response to a comment you write: [In business school you learn that people who have different interests can usually reach some sort of agreement. The bigger problem is that the party with the most power has no incentive to compromise. -- Scott]

Our public health care system is so poor and our nation is so rich. Yet, according to the pundits and politicians, it is actually a terrific system and we can't afford to have a health system which provides a national health care safety net . Where are the comparisons between our system and those of other rich countries? Why is ours so poor in between-nation comparisons? Why don't the pundits and politicians bring these comparisons up? Perhaps the health care industry sees no reason to compromise. And no need to let its political and media lackies show us any comparisons. So the public doesn't know any better.

The health care fiasco is just one example of the way the "party with the most power" is addressing the need for compromise. But from history we know that this variant of "let them eat cake" to deal with the needs of the non-wealthy won't work forever. Just ask Marie Antoinette.

Eventually there will come a "tipping point". Some do-gooder named Abe Lincoln once said, "You can fool all the people some of the time, and some of the people all of the time, but you can't fool all the people all of the time." But, as long as you can keep the suckers unable and unwilling to make critical comparisons, you can keep the current world-view going.
So, for the sake of national peace, let's NOT teach people to make comparisons! Maybe we CAN fool them all of the time!
 
 
+1 Rank Up Rank Down
Jan 27, 2011
"Every knowledgeable observer recognizes that the solution involves both deep cuts in expenses and higher taxes on those who can afford it."

You ask several posters for relevant sources but don't hold yourself to the same standard. You chose a position that can never be proven, just dis-proven, thereby transferring the burden on the other person to disprove what you said (making you a Weasel). If you find sources supporting your claim, that's just your Confirmation Bias kicking in. If you find a source disproving your claim (and, honestly, with the internet how could you not?) you'd reject their "knowledgeable" credentials when your Cognitive Dissonance kicks in.

fwiw, I side with the "bleeding heart liberals". I have a wife and kids and our household income is $70k/year, and I feel that my taxes are too low. I think we should do more to help those who don't have enough, unlike some here in Texas who are trying to cut the free breakfast for students from impoverished families. Republican-radio-man (http://en.wikipedia.org/wiki/Michael_Berry_(radio)) here wants to stop "rewarding" parents for having kids they can't afford by no longer feeding the kids for the parents. I'd be interested in a study tracking crime rate and the funding of various social programs targeted at teens/pre-teens. Not crime-prevention programs, but social programs like the free student breakfast/lunch, after-school programs, etc. If anyone knows if such a study exists, please post it.
 
 
Jan 27, 2011
sigh... politics. "My side is right and you are wrong."

Quote:
1. People have different information
2. People have different selfish interests
3. People have different superstitions
4. People have different skills for comparing

I see how people have different information. I see how people different interests. I see how people have superstitions or beliefs (although I believe this category could go under information, eg. How do "know" anything.)
But I wish you were specific on how you define "skills for comparing." Because I don't see how it's objective. If you had a class of people with different information, beliefs, and interests, how would you determine if their comparison skills were increasing? Lets say you have the ideal student who has brilliant comparison skills. It makes me wonder what does that student do that separates him from his not-so-talented classmates. How would measure this brilliance objectively?
 
 
-1 Rank Up Rank Down
Jan 27, 2011
Here's a link to corroborate my statement about revenues as a function of GDP:
www.taxadmin.org/fta/meet/05rev_est/platt.pdf
 
 
+5 Rank Up Rank Down
Jan 27, 2011
And who would teach these classes? Have you spent time in a typical high school classroom recently? You'd get farther creating a Dilbert comic textbook series. Teacher's can't teach what they themselves don't grasp.
 
 
+1 Rank Up Rank Down
Jan 27, 2011
2. As for the false choice between raising taxes and cutting spending, a couple of thoughts:
(sorry, not sure what happened)
a. For those who "can afford it," as the tax structure has become more and more progressive in this country, the so-called "rich" have taken on a bigger and bigger share. Personally, Scott, I think you're already paying enough. So am I, knowing that about half of every new dollar I make goes to taxes somewhere. But I also know that half this country pays no income tax at all, because they're "too poor." At what point do we agree that everyone needs to contribute something? At what point have the well-off paid enough? Isn't it the "rich" that creates the jobs?

[I agree everyone should pay federal income taxes, on principle. But you'd have to tax the lower income levels into starvation or homelessness in order to put a dent in the budget. So the solution would be worse than the problem. -- Scott]

b. Regardless of tax rates, Federal government revenues have hovered around 18% of GDP for the past 30 years. (To respond to your parenthetical comments to others, those links are available, I wish I had time to get them for you right now). So the best thing to do, if you want to maximize federal government revenues, is to do whatever you can to increase GDP. Incidentally, I'm not necessarily in favor of this, because....

[All economists agree that growing the economy is the very best way to increase tax revenue. And all of them agree it will have far too small an impact by itself. -- Scott]


c. No matter how much money the government makes, they will always spend more. The previous comment about a balanced budget amendment is absolutely correct, but not likely to happen. Look at the States. Many, if not all of them are required to have balanced budgets. But what is happening? They spend everything they make in the good years, then have to cut in the bad years. But in the good years, they also made long term committments to public employee unions, etc., that they cannot meet. And they can't declare bankruptcy. And they can't print money. The Feds can print money, so if there's a balanced budget amendment, we have to make sure they can't print money to make it. And we have to hold feet to the fire to make sure they don't make unsustainable commitments. (You mean like Social Security and Medicare? Maybe....)

3. There is a *lot* of room to cut spending. I suspect if someone were to do a "constitutional review" (that is, check for actual constitutional authority) for all government programs, we'd find a tremendous number of them do not have authorization to exist.

[You would make your budget decisions based on the ideas put forth hundreds of years ago by slave-owners who pooped in holes. That strikes me as not even trying to look at the problem in a practical way. -- Scott]

4. So in a nutshell, I say, do the massive spending cuts FIRST. Then, show me why we still need higher taxes. Then, show me why the middle class that they "call" the rich has to pay them.

[Here's a good example of the comparison problem. You argue as though you could get the benefits of the cost cutting without the burden of pushing tens of millions of people into starvation and hopelessness. Your plan converts you from a Republican into a source of protein. -- Scott]
 
 
 
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