Did Trump Win Because of Facebook?

Techdirt’s Mike Masnick says, “No,” and he warns about the dangerous proposals that are being made by those who think the answer is “Yes”:

Yesterday I wrote that people rushing to blame Facebook for the election results were being ridiculous, and it generated a fair bit of discussion (much of it on Twitter). And this was before NYMag’s Max Read went out and wrote an article literally titled Donald Trump Won Because of Facebook. …

These stories tell a neat and convenient tale, a pre-packaged “thing” to blame. And they’re all [expletive deleted]. Yes, Facebook had lots of people passing around fake news stories, or misleading news stories. And, yes, lots of people live in bubbles where they only see/read/hear stuff that they are prone to agree with. But this narrative that it was Facebook’s “primed for engagement, not truth” algorithm that got people to go out and vote for Trump is both simplistic and dangerous. …

The people calling for Facebook to “fix” this problem don’t see where this leads, but it’s not good. In various conversations I’ve had in response to yesterday’s article, I keep drilling down and trying to see what people think the “solution” to this “problem” is, and it inevitably comes back to something along the lines of “well, Facebook needs to stop the fake news from spreading.” If only it could. Fake news, rumors, conspiracy theories, echo chambers and “bubbles” predate Facebook by a long shot. …

Fake news is spread in basically every election for the US President in history. It didn’t take Facebook’s algorithms, and it won’t go away if Facebook’s algorithms change.

In fact, it’s likely to make things even worse. Remember the mostly made up “controversy” about Facebook suppressing conservative news? Remember the outrage it provoked (or have you already forgotten?). Just imagine what would happen if Facebook now decided that it was only going to let people share “true” news. Whoever gets to decide that kind of thing has tremendous power — and there will be immediately claims of bias and hiding “important” stories — even if they’re bullshit. It will lead many of the people who are already angry about things to argue that their views are being suppressed and hidden and that they are being “censored.” That’s not a good recipe. And it’s an especially terrible recipe if people really want to understand why so many people are so angry at the status quo.

Telling them that the news needs to be censored to “protect” them isn’t going to magically turn Trump supporters into Hillary supporters. It will just convince them that they’re even more persecuted.

Read the whole thing!

An unhealthy fixation on data

I couldn’t help but recall a recent critique of the so-called electoral “efficiency gap” when reading the article that marks Andrew Ferguson‘s return to Commentary magazine. It’s titled “The Night Data Died.”

In both cases, the author laments the elevation of statistical analysis over the reality of human action.

In turning to social science, in making it the source of knowledge about the behavior of human beings, the political world is not alone. Indeed, it came rather late to the game. For a generation now, every businessman in the developed world has been bragging about how big his data is. Where he once might have trusted his intuition and experience and acquired wisdom to sense the movement of a marketplace, he now hires bespectacled, poorly groomed youngsters with sloping shoulders to produce algorithms that can be pasted into power points, which will in turn wow the shareholders and board of directors. Every field of American life—preschool education, baseball, book publishing—has succumbed to the conceits of social science.

The arrival of Barack Obama brought the reliance on data in politics and government policy to its present level of intensity. His election in 2008 became Exhibit A. His campaign staff’s obsession with “quantitative analysis” was plausibly credited with finding pockets of previously ignored Democrats and getting them to the polls. The magic failed four years later when Obama’s turnout actually fell, but no matter. The data delusion is hard to shake. …

… Ominously, Washington’s obsession with reducing human activity to the x’s and o’s of an algorithm goes beyond campaigning. President Obama helped popularize the academic enthusiasm of “behavioral economics” to enshrine the rickety findings of economics and social psychology in government policy. He even issued an executive order—the man did like his executive orders, didn’t he?—requiring every federal agency to deploy a team of behavioral scientists to help in drafting regulations. The potential for mischief was enormous. I’m happy to report that Obama’s order has had almost no consequences, besides the simplification of a few government forms and the increasing frequency of email communication with the recipients of government loans. But it was a close call.

The data delusion grips us even as the failure of data lies all around us. A politician’s reliance on polls is matched only by the well-documented capriciousness of polling. Every quarter, government economists make forecasts that are duly reported by journalists and never come true—a fact that journalists report much less often. No policymaker, no matter how consumed by data, foresaw the greatest social calamity of our young century, the financial collapse of 2007 and 2008. And the collapse itself was at least in part a failure of “quants” who had come to believe their statistical models allowed them to manipulate markets to their advantage. Meanwhile, for nearly a decade, the wizards at the Federal Reserve have used the most impeccable data to orchestrate a robust economic recovery that always seems a few quarters away.

Now, though, even the most data-driven geek should find the evidence impossible to ignore—because the failure is being quantified.

Man bites dog: Insurers willing to ditch individual mandate

Ali Meyer of the Washington Free Beacon highlights a surprising piece of news from the health insurance industry.

Health insurers approve of repealing Obamacare’s individual mandate, the part of the law that forces Americans to purchase health insurance or pay a penalty, among other provisions included in replacement plans put forth by Republicans.

America’s Health Insurance Plans, a trade association representing health insurance companies, released a paper this week outlining their views on how to make health care work for every American.

“The Affordable Care Act will see significant changes,” the group said, using the formal name for Obamacare. “Those changes can either begin a stable transition to a better approach, or they can bring about even more uncertainty and instability.”

“Replacing the individual mandate with strong, effective incentives, such as late enrollment penalties and waiting periods, can help expand coverage and lower costs for everyone,” they said.

While the individual mandate will likely be changed, the group said there will need to be an effort to encourage everyone to purchase coverage to avoid high premiums and fewer consumer choices.

In June, House Speaker Paul Ryan (R., Wis.) released the GOP’s agenda to reform health care by replacing Obamacare. The plan would offer tax credits to the uninsured so they can purchase health coverage. It would also replace guaranteed issue with high-risk pools and expand provisions like health savings accounts.

The trade association supports these measures.

“Tools such as tax credits can help low-income individuals and families get the coverage they need—but must be effective enough to make coverage truly affordable,” the group said. “For Americans with complex medical needs, solutions like high-risk pools can mitigate the risk of adverse selection and deliver effective coverage.”

“More consumer choice and more consumer control, through solutions like tax credits and Health Savings Accounts, will deliver efficient, effective solutions that control costs for both consumers and taxpayers,” the group said.

The most Scalia-like Supreme Court candidate

Kevin Daley of the Daily Caller highlights the potential U.S. Supreme Court nominee who’s perceived to resemble most closely the man he would replace.

A panel of legal scholars has identified Utah Supreme Court Justice Thomas Lee as the candidate on President-elect Donald Trump’s list of potential Supreme Court nominees most like the late Justice Antonin Scalia.

The four-person group produced a paper called “Searching for Justice Scalia: Measuring The ‘Scalia-ness’ of the Next Potential Member of the U.S. Supreme Court,” which measured key characteristics to determine which candidates are most likely to exhibit Scalia’s jurisprudence and style.

“If one is serious about replacing Justice Scalia with a jurist like him, one should care more about how a potential replacement reached a decision, which will illuminate how a judge approaches the law,” the authors write. “This, in turn, will provide a far clearer window into how that judge would behave when elevated to the Supreme Court, and, ironically, the outcomes they would reach.”

The study measured “Scalia-ness” in three ways: How much the candidate engages with or promotes originalism, Scalia’s preferred interpretive theory, in their opinions; how often they cite Scalia’s non-judicial writings; and how often they write separate opinions.

More Main Street than Wall Street

David Smick writes at National Review Online about a necessary shift in economic priorities.

People simply are holding back. Indeed, the lesson since 2008 is that record-low interest rates mean little if you are apprehensive of the future or believe the system is rigged. To achieve a robust economy, therefore, attitude is everything. It is what Keynes meant when he referred to the rise and fall of the people’s “animal spirits.”

Because people are holding back, the economy is suffering from a debilitating disease. Productivity growth (doing more with less) has been abysmal because broad-scale investment in innovation is less than it should be. And there may be questions about the quality of today’s innovation. In recent years, America’s large corporations (those that haven’t escaped by moving overseas) have used the Federal Reserve’s low interest rates not to invest in America’s economic future but to buy back their stock.

Perhaps even more worrisome, innovators are starting firms at half the rate they did 15 years ago. And those businesses that are starting up are finding it difficult to expand into new opportunities as quickly as they have done in the past. Young firms are finding it tougher to go public (and the bulk of new job opportunities come when firms five years old or less go public). America was once the world’s Startup Nation. Not so anymore. And why are startups so important? They happen in America.

There are many reasons why people are holding back. They can sense that Washington, D.C., has become a partisan cesspool where nothing ever gets done. The world, both financially and geopolitically, is a terrifying place. Moreover, technological change is coming so fast that many people feel overwhelmed — or they sense that the big breakthroughs have already been achieved.

But the greatest reason people are holding back is that the economy is under the control of a stifling corporate capitalism of top-down mismanagement, backroom deals, and senseless financial engineering. Too many policymakers still cling to a culture of centralized, top-down design at a time when the world, whether with ISIS or Facebook, is experiencing a bottom-up revolution.

Trump shouldn’t pick winners and losers

Ian Tuttle of National Review Online reminds us that a command economy is a bad idea, regardless of who’s in charge of government.

Last week, President-elect Trump intervened to keep the Carrier air-conditioner company from moving part of its operation to Mexico and shutting down its plant in Huntington, Ind. Then, on Tuesday morning, Trump tweeted that aerospace firm Boeing was overcharging to design and build the new Air Force One fleet, adding in a brief interview at Trump Tower that he thought Boeing might be “doing a little bit of a number.” With plenty of American companies looking to lower their bottom line, Trump will no doubt locate a new company of concern next week.

It’s hardly unprecedented, of course. The United States has a long history of federal intervention in the affairs of large companies, and not always for the worse. It’s not impossible (though it’s perhaps improbable) that Trump’s deal with Carrier will end up in the country’s best interest, and, as I wrote recently, it’s not unreasonable to ask whether the federal government is getting the best bang for its buck in defense contracts, the Pentagon not being the most conscientious of spenders.

But it’s not clear yet that President-elect Trump’s interest in Carrier and Boeing is part of a coherent approach to big business. Many firms are considering offshoring jobs. Why was Carrier favored? The government has more than 1 million defense contractors. Why single out Boeing? Will the president intervene with every firm that offshores? Will he squint at every defense contract? Unfortunately, there is the distinct impression that Trump is primarily responding to whichever events happen to penetrate his consciousness.

This would, of course, fit the Trump mode. It was just a few weeks ago that he tweeted about flag-burning because he’d seen protesters burning flags on a Fox News broadcast. And perhaps singling out a few firms is meant to send a message to others. But, at first blush, this does not look like a foundation for a healthy economy. Rather, it looks like arbitrary government intervention.

This weekend on Carolina Journal Radio

North Carolina’s maze of alcohol-related rules and regulations blocks innovation from entrepreneurs in an expanding industry. Jon Guze attempts to navigate the maze, and offer ideas for reform, during the next edition of Carolina Journal Radio.

Katherine Restrepo explains how Union County saved nearly $1.3 million by adopting a Direct Primary Care option for its county government workers. Wake Forest University economist John Wood dissects the problematic link between politics and central banking.

John Hood and former Gov. Jim Martin explain why Martin’s name will soon be attached to North Carolina’s premier higher education watchdog group. Plus the N.C. Department of Transportation’s chief engineer, Mike Holder, offers an early status report on DOT’s response to damage linked to Hurricane Matthew.

New Carolina Journal Online features

The latest Carolina Journal Online parody features a proposed radical overhaul of North Carolina’s Council of State races.

John Trump’s Daily Journal highlights state laws that impede growth of craft alcoholic beverage businesses.