also, this.

by Josh Nicholas

Journalism has a presentation problem

One of the biggest issues with modern journalism is that framing is overvalued and understanding is undervalued. This is true not just in practice, but also in the way it is taught.

Look at any journalism course in Australia and you’ll find that subject knowledge is discounted in favour of presentation skills. Internships and practical media projects are favoured over electives in other academic disciplines - statistics, economics, medicine etc.

This came to mind as I read the last of Nate Silver’s essays on the 2016 election.

In recent elections, the media has often overestimated the precision of polling, cherry-picked data and portrayed elections as sure things when that conclusion very much wasn’t supported by polls or other empirical evidence.

By teaching journalists that their job is packaging the ideas and actions of others, the medium inevitably becomes constrained. What is good presentation exactly? Among other things it’s putting things as simply as possible.

On the one hand this is a good thing - it makes the news widely accessible. On other other, simplification can itself be misleading. Condensing dozens of pages of a working paper, or decades of iterative academic theory, by necessity requires the subtraction of nuance. This is what Nate Silver identifies in his latest piece.

Experts provided myriad caveats to their forecasts in the 2016 election. But constrained by their job as packagers, journalists provided only certainty. By banishing the details as boring or irrelevant, trying to get a clear angle, we were systematically misled.

”While many things about the 2016 election were surprising, the fact that Trump narrowly won1 when polls had him narrowly trailing was an utterly routine and unremarkable occurrence. The outcome was well within the “cone of uncertainty,” so to speak.”

But a narrowing of the role is only part of the problem. One of my friends is currently studying journalism and recently completed a course on data journalism. While this taught her a great deal on telling stories with data, she has little idea of what data to use or when, There were no economics, demographic, health etc. components of her course to provide her with the context surrounding the data.

This narrowing of expertise by definition curtails what stories are told. A bunch of technical skills are being dumped on the market with little subject knowledge to act as guidance to what exactly is a story. It also means these journalists are at the mercy of the very experts they end up packaging.

Now, of course, this whole argument is a great generalisation and misses many wonderfull journalists. Especially older journalists who have spent time and built up subject knowledge. But having spent much of the past decade around young and upcoming journalists, Silver’s analysis reads incredibly true. And it’s very worrying.

Why politics is holding us back

Buried in the first paragraph of John McCain’s statement on health reform is one of the unspoken problems with our conception of democratic politics. Unless a bipartisan process is followed, he says, “one-fifth of our economy and every single American family will be subject to reversal with every change of administration and congressional majority.”

But shouldn’t every issue be dealt with in a bipartisan fashion? Wouldn’t that lead to the greatest amount of stability, allowing everyone involved to understand what is happening and plan accordingly?

Rather, the perfect has become the enemy of the good. Declining legitimacy has seen parties focus on wedging each other than abiding by coherent ideologies. They paint their enemies as so extreme that it becomes impossible to collaborate and accomplishments must be immediately undone.

Take Australia. The last ten years have seen our two major parties flipping and flopping on climate change policy. We saw the introduction of a price on carbon, which was immediately removed by the next government.

Companies have no certainty to invest. The voters are so confused that few have noticed the right are now championing government intervention and the left a market mechanism.

I love dialectic. It’s the best way to arrive at good ideas and solutions, but incorporating as much knowledge and experience as you can. But this only works if you approach it with goodwill. Not only to listen others, but accept it when they are right.

The economy is everything

With Australia currently engaged in an abysmal debate over same sex marriage, it‘s refreshing to be reminded that morality often has a utilitarian history.

For example, this recent paper suggests that norms around illegitimate children are based in economics.

Based on data from the Austro-Hungarian Empire and modern Austria, we show that regions that focused on animal husbandry (as compared to crop farming) had significantly higher illegitimacy ratios in the past, and female descendants of these societies are still more likely to approve illegitimacy and give birth outside of marriage today.

The key point is actually buried a fair bit down in the paper. The reason there is this split in social norms between crop and animal farming communities is apparently due to differing labor structures.

18th and 19th century workers on crop farms were on short term contracts, often working as day labourers.

In crop farming, the work load and the resulting demand for additional labor, is determined by the rhythm of the seasons... additional manpower is needed in the harvest season.

Workers on animal farms, meanwhile, had long term contracts. This was less precarious, but they also tended to live on the farms and so had little opportunity to create their own households. Their illegitimate children were tolerated by the communities.

In contrast, in animal husbandry the workload is distributed relatively evenly throughout the year... Animal husbandry requires a sound knowledge of the peculiarities of each animal (analogous to firm-specific human capital), while harvesting is less specific.

The diminishing returns of research

"Innovation" has become a political/economic panacea over the past few years. But an interesting paper suggests that research also obeys the laws of diminishing returns. Research productivity in the United States has declined spectacularly in the last few decades.

A good example is Moore's Law. The number of researchers required today to achieve the famous doubling every two years of the density of computer chips is more than 18 times larger than the number required in the early 1970s.

The paper is mainly aimed at updating endogenous growth models, which assume that research exhibits constant returns. But the examples given - declining research productivity in technology, medicine and the economy as a whole, have huge implications for those thinking we can just chuck a bunch of researchers onto the problem of stagnating growth.

We find that research productivity for the aggregate U.S. economy has declined by a factor of 41 since the 1930s, an average decrease of more than 5% per year

Averaging across all our samples, research productivity falls at a rate of about 9% per year, cumulating to a 2.5-fold decline every decade. At this rate, research productivity declines by a factor of about 15 over three decades of changes; put differently, it requires 15 times more researchers today than it did 30 years ago to produce the same...

We don't just need to chuck more brains at this problem. We need to use our brains to deploy those brains.

The long history of financial technology

One of the best things about history as a subject is its power to put us in our place. Progress - especially of the technological kind - is very rarely as radical as we think.

When I think about all the hype surrounding the blockchain, I start to think of all the other technologies that have been used as immutable ledgers.

The tally - a wooden stick used to keep track of financial transactions - is a perfect example.

The sum involved in a transaction was represented by notches in a stick of wood, which was then split to furnish both payee and payor with tangible and tamper-proof evidence of the event. Although often inscribed with symbols to identify the measuring unit or to give other information about the transaction, the basic data in the form of different width notches, was understood by both the literate and the illiterate. This feature invites speculation that the use of the tally may have predated written communication.

The exact grain of the wood in each tally is different, meaning they are all but impossible to forge. The tally essentially achieved with nature something the blockchain does through an encrypted public ledger.

According to Willard Stone, the tally may go back as far as the ancient Greeks. Maybe even to 484BC.

Herodotus tells of a Greek from Miletus, because of the insecure conditions in Ionia, giving half his fortune to Glaucus, a Spartan known for his honesty, together with tallies... Many years had gone by when the sons of the man by whom the money was left came to Sparta, and had an interview with Glaucus, whereat they produced the tallies, and asked to have the money returned to them.

From there the tally pops up all over the world and throughout history. Marco Polo described their use as IOUs in China. French monasteries used them to keep track of deposits. The British exchequer used tallies both to keep track of taxes paid, as well as what was lost during currency debasement.

When the Bank of England was foundedin 1694, one of its first acts was to make a loan of ~€1,200,000 to the Government. Acknowledgement of the debt was in the form of tallies, the longest of which exceeds eight feet in length (these are still in existence and unredeemed).

This isn't to say that the blockchain isn't a spectacular achievement. It very much is. But we should recognise that a lot of today's financial technologies aren't solving unsolved problems. They are just more efficient ways of doing what we already do.

We may be seeing an unprecedented technological boom. But most of our problems aren't new and we've been using technology to solve them since year dot.