Statistical Study of the Children of Lake Wobegon

The dark side of grad school... I can't even listen to NPR without getting into hyper analytical mode.

Take Garrison Keillor's description of Lake Wobegon, where all the women are strong, all the men are good-looking, and all the children are above average.  Teehee, you say, how can ALL the children be above average (snicker snicker).  I am apparently incapable of enjoying simple humor, and instead miss the point entirely.

Instead, I assume that this can be explained by the Central Limits Theorem, and decide that the null hypothesis should reflect that all the children score above average on some scale.  To do so, we assume that the scale is normally distributed, with the average score being 50. 

H(sub o): mu > 50
H (sub a): mu < or = 50

What I'm sure we'd find in a sample of the population is a confidence interval where the mean may be above 50, meaning that we fail to reject the null hypothesis at, say, 90% confidence.  I do not know if we could ever conclude that the mean of the population is above or below average with any degree of statistical significance, not being in possession of a data set.  It is troubling that the contention is about all children, and not the mean of the children, but I can't really apply statistics to that, just common sense, which is not part of the curriculum.

Getting cocky...

You know those moments when you start getting cocky about all this free time that you have?

Yeah... Between an internship, an impromptu return to Chicago, a commitment in Milwaukee, a return to Upstate New York, and the beginning of the Spring Semester (with high temperatures of -2), all that free time evaporated.

Back to the sporadic posting and infrequent book reading.

Starbuckin'

Considering the rate through which I am plowing through books, one may conclude:
1) I seriously have nothing else to do
2) Am such a genius that 400 page tomes on breweries are no match to my superior intellect.
3) I read really easy books.

I fear the 3rd is the real reason, assisted by number 1.  Yet, here I am with the third book of the year completed and its only the 4th day.  I read Starbucked by Taylor Clark, a look at the founding and growth of Starbucks followed by a number of the criticisms of Starbucks as a force in the global marketplace.  It's a couple years old, being published in 2008, but it's not like the history of the founding of the company is going to change.  However, I did realized that anything written before the economic crisis of 2008 sounds false and ingenuine.  Everyday luxuries sounds decadent, not an occasional measured splurge for hard-working office drones.

So here I am, writing this post in a Starbucks in a pretty liberal college town.  Looking at the stickers on the laptops of those who have set up shop here, it seems that few are really worried about buying a cup of coffee here and what this means about the homogeneity of the global marketplace.  I can't help but laugh that I'm seeing stickers that spell out "Capitalism" in Coca-Cola scrall and an image of Che wearing Mickey Mouse ears.  In Starbucks.  Starbucks, who just announced that they were starting coffee shops in Vietnam.

As I take another sip of my Pike Place drip coffee with a pound of espresso roast beans in my bag (sitting next to this book that I need to return to the library), I found that the only thing this book really made me reflect on is my own preferences on roasted coffee and why I detest the freeze-dried instant coffee that my mom drinks.  Robusto beans are evil and must be destroyed.  But other than that, I'm not going to fret about buying coffee from a company that lets me park in a comfy chair for an hour and potentially use their internet to write scathing reviews of their company.  Nor will I pick up one of the trendy reusable coffee cups that they are trying to schill (I have my own).  The white and green cup described in the book is no longer a status symbol, but rather a fixture... something that says "I haven't really woken up yet, so don't talk to me about anything too important."  It'll have to do until Caribou Coffee makes its way eastward.

Also, I now know more about the Tully's Coffee chain that Patrick Dempsey just bought. 

Fourth Down

Congress decided to punt on the fiscal cliff fiasco.  No major developments, except that Cantor is vying for Boehner's job, and Boehner tried so save face by swearing at Reid.

Looks like we have two more months of this.

Economics and Baseball!

I finally got around to reading a book that I've wanted to read for a while now.  Just finished "Moneyball: The Art of Winning An Unfair Game" on the advice of my economics professor, who seriously modeled a couple lectures on the Chicago Cubs.  Who am I to complain when it appears that he had unlocked the reason for 104 years of futility due to lack of organizational focus and misplaced efficiency wages?  At least it's not because I didn't want it enough.

Wait, the Cubs overpay for players?  You have GOT to be kidding me.

What I loved about this book is the way that economics theory is casually introduced throughout the book.  Prices for players decrease as supply increases around the trading deadline?  LOVE!

Book #2 done... 48 more to go for the year.

Bitter Brew

One of my New Years resolutions is to read 50 books this year that are not assigned for class.  So here's to number one.  Or, as my husband noted, how the hell did you finish that book already when you started it last night?

I finished reading Bitter Brew: The Rise and Fall of Anheuser-Busch and America's King of Beers by William Knoedelseder.  Not sure why I picked up the book, as I don't drink Busch products, and Budweiser never sits well in my stomach.  However, having a father who grew up over the river from St. Louis, I do have the memories of a cousin who worked for the Busch family, the clydesdale horse magnets and knicknacks, and the annual Budweiser calendar gifts.  Plus, I do like beer. 

Ironic, because at 15 IBU, Budweiser is really not bitter.

I won't spoil the read.  Just imagine a bunch of kids in St. Louis with instant name recognition and access to tons of alcohol and money.  You can almost see where this is going.  Now add a baseball team.

One thing I did find surprising: Harry Carey was rumored to be having an affair with his boss' daughter-in-law.  If you grew up watching Harry call games, you can see the heavy-drinking and heavy-partying that is described in the book.  But, sex scandals?  What?

Resolutions

Trying to keep my resolutions for the year somewhat managable, but for now they are:

1) Lose 15 pounds.  This would be the 10 pounds I managed to add in my first semester of grad school plus the 5 that I've been saying I need to get rid of for two years now.  I figure this will involve eating healthier food and exercising more.  I hesitate to say exactly how this will happen (eating local, organic, running, P90X), mainly because of a cash flow issue (see earlier post on the fiscal cliff).

2) Survive 2 more semesters at an intensely competitive Ivy League school.  Strangely, competition does not come from my fellow grad students, but rather the competition between my professors' expectations and my own abilities. 

3) Read 50 books that were not assigned for class.  Sure, some of these were recommended in class, but I will not be tested on them.

Let's go 2013!

Deal Within Sight?

CNN is reporting that a deal on the fiscal cliff fiasco is in sight.  While this may be in time to create the instantaneous contraction of the economy, it's not fast enough to prevent all damage to the economy.  A quick look at the Dow Jones for the past 5 days:

Generally, this shouldn't look like a mountain range 

While I don't like to equate individual stock prices directly to the health of the overall economy, I think it does show that business investors are worried about what is going to happen without a deal.  What I do see when I look at this graph is swings in confidence and general uncertainty.  However, if there was another economy in the world more promising, and more certain investment prospects, I think you would have seen steeper dives.  The question for most investors is, if not American companies, then what?  There's only so much land and gold to hoard, and if the entire global economy contracts, who can rent the land or buy the gold? 

Hoping that a deal comes sooner rather than later... and that we stop this nonsense and never do this again.

Conflict of Interest

For the Bears to go to the playoffs, the Vikings must lose.
For the Vikings to lose, the Packers must win.

Most people would conclude that Bears fans should root for the Packers.
Most people would be wrong.
No real Bears fan would ever root for the Packers.

What's a Couple Hundred Thousand Dollars?

In the interest of full disclosure, my own personal household's cash flow is dependent on government spending.  Between my subsidized student loans from the Department of Education, and my husband's research grants from the Department of State, and the VA programs that mean that I can ship my dad off to a home when he goes fully senile (thank you for your service, Dad), going over the fiscal cliff is going to be very, very, very, very bad for me personally.  No more loans, no more income, and no possible help from the Bank of Dad who now might have to provide for his own long-term health care.  In short, homelessness and starvation await. And, with no housing subsidies or food stamps that normally pick up the slack in these times, we're royally screwed.  That's just me.  And, no, my situation would not have been better if we had stayed in Indiana (my income was heavily dependent on federal spending).  If you know any students, retired folk, military members, and anyone who works in education, manufacturing, construction, healthcare, social services, or... well... anyone who sells anything to people who work in these sectors, there's a good chance that going over the fiscal cliff is going to be disasterous.

With so much at stake, Congress really needs to come up with a deal.  Like now.  Decreases in government spending will decrease the overall spending of the economy, thereby contracting the GDP of the United States.  With less government spending, private firms and individuals will have less money to spend (if you don't buy that helicopter, then there is a factory that no longer has to employ people to build that helicopter), which means that fewer transactions will take place on which income and sales tax can be charged.  Decreased spending will then lead to decreased revenues, requiring further reductions of spending, or increases in tax rates.  Neither is a good idea for growing an economy, leading me to wonder what economic training Grover Norquist actually received.  Not that Norquist is really paid to advocate for sound economic policy, but rather is paid to lobby for decreased tax rates. 

This brings me to my main question: Why is the current hold up about whether taxes should be raised for everyone making above $250,000, $400,000, or $1M?  What do these sums have to do with anything? 

Chosen just to remind me of this scene?

GIFSoup
What I find the most troubling thing is that Congress is hung up on which ad hoc level to set.  There appears to be a complete disconnect from reality with these numbers.  Congress could actually tie this to some measure that has real bearing on the economy.  A multiple of the poverty line, based in real dollars that slides based on the number of members of the family.  If one would set this at 10 times the federal poverty line, then an individual does not see tax increases until (s)he earns $111,700 per year.  A family of four sees an increase at $230,050.  If you use the Census Poverty Threshhold, you get slightly different figures ($114,840 and $228,110 if the family of four is two adults and two kids), but still in the same ballpark.  Both methods would tie tax increases to some measure of real poverty and how much money is actually needed to provide for the basic needs of the population, or satisfiy the goal of shifting the tax burden to those who can afford it.  It takes away the method of trying to figure out which figure sounds rich and which is middle class.

But, what is a middle class income?  The answer is none of the above  Median household income for the United States was $50,054 in 2011.  That's one fifth of the smallest number that is being talked about, one twentieth of the $1M figure.  Even taking 10 times the poverty level of the US doesn't get us close to this figure.  If a solution should look at taxing the wealthiest households, then a multiplier of the median household income should be considered, be it 3 times or 5 times the national median.

What Congress should not be doing is throwing out these arbitrary numbers and think that sound policy is being produced.  Nothing about the fiscal cliff has been about the creation of sound public policy.