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Sunday, June 28, 2015

Thoughts on my story

When I was a teenager back in 1987, was looking at taking the SAT's for the third and last time, but was severely disillusioned, and for some reason just didn't apply. Luckily before it was too late, one of my teachers Ms. Mary Jane Tipper asked me one day at school was I ready for it and I told her. She freaked out. Got an application, had me fill it out, and send it in, where she paid the application fee plus the late fee. What happened next is like a Hollywood ending, but it's relevant to first go back into the past some years.

You see, Ms. Tipper had been the one who tested me for the gifted program which I entered in the fourth grade when I was nine, and somehow she was there again at a critical moment in my life, when she saved my future.

Where were my parents? In many ways very supportive their support had faltered after a messy divorce. They didn't even know this story until I told it to them recently as I reflected upon it. And I don't like to blame race, but their backgrounds in racist society? The in's and out's of getting your kid into college weren't part of their training. But I should add there was a heavy religious component involved as well.

I was saved by a White teacher in the Deep South, as I grew up in the area of Tifton, Georgia, USA, and my life points to a different reality than most wish to see.

My avid love of reading caught the attention of one of my teachers in elementary school, which is how I'd been sent to Ms. Tipper to be tested. And yup, teacher was White. Wish I remembered her name. Remember her face though. She was young and I never forgot how important it was to her. Even as a child I could see: education is a BIG DEAL as it was written all over her face.

After I got into the gifted program, which in Georgia was called ILP back then, not sure what it is now, for Independent Learners Program, I found most of my classmates were not of my race, as I ended up in the college track. At one point I think there was just me and one Black girl, whose name was I think Hope. I was expected to go to college.

Turns out your peer group has a vast impact on you as a teenager, and as far as my peer group was concerned I was not only one of them, I was just expected to do similar things to them, like most were headed for college.

But as I noted a high score on a test for adverse stressors in childhood in a previous post I had a LOT going against me. Product of a broken home, with so many things I'd just as soon remain private. My parents had always at best been lower middle-class, but poverty had come after the divorce when I and my brothers were with my mother. Being poor is no fun, and is crushing to the ego. It saps your strength, and makes it harder to do important things, like work on your education.

The rest of the story amazes me to this day and actually refreshed with Ms. Tipper recently in a phone call, and was surprised at what I didn't remember. Turns out she also enlisted the help of a classmate of mine named John Dorminey who had a car. He picked me up on the day of the SAT's, and dropped me off back home later.

And when the scores came back, guess what? Already hinted at a Hollywood ending, so yeah, I had the highest SAT of my graduating class.

Mailbox filled up with letters from colleges and universities from all over the country, and for some reason only place I applied was to Vanderbilt University. Thankfully, they accepted me and gave me a full tuition scholarship, and I graduated in four years with my degree in Physics.

Was I in any way a victim of a racist society? I ponder that question but in a different way from most, as yes, to some extent as to what my parents knew, but no, of course not, as to the unbelievable support I got from community, where yeah, important people in that community happened to be White.

Reality is complicated. We oversimplify at our peril.

All kids need community support. And they need knowledge about what best to do.

It's not enough to have opportunity: you have to know it's there, and also seize it, where a prod here and there can make a world of difference. Someone has to be there for you looking out for what's best. I was lucky enough to have that someone.

Thank you Ms. Tipper, a teacher who made a difference. And, John Dorminey for being a great classmate when I was in serious need.

The South will confuse you if you think you understand it without looking deeply. It is so much about community, at its best.

Community is what matters. How we help each other is what makes a difference.


James Harris

Sunday, June 14, 2015

Pushing to unemployment theory?

By my own admission ideas I have around curbs in monetary flow leading to unemployment are speculative, as I don't see a sufficient framework as of yet to consider these ideas to be a science. But it is fun to consider them more and see if the outlines of one can emerge.

First off, the concept is incredibly simple: money represents an abstraction for a favor and monetary flows are required for people to employ each other, where unrealized abstracted favors lead to unemployment.

That is, if someone just sits on cash, for instance, rather than spend or invest it, then they drive up unemployment, is the speculation which I'd like to see lead to scientific theory.

And I noted in a prior post that you can look at agriculture, where if necessary the bulk of a human population can be employed by it, but the rise of modern agriculture and agricultural machinery means that few people in the US, around 2% of the workforce, are needed for it! So clearly people simply shift, which is good news as it means robots will not drive up unemployment, if these speculations are correct.

So let's push this speculation and imagine a person in the US makes $100 million US in some way, and imagine avoids mostly paying taxes, and proceeds to sit on $50 million US in cash.

Only a very wealthy person could do such a thing, as consider someone make $100 thousand US, which would be middle-class, though upper levels. That person would pay a certain amount in taxes, and spend or invest the rest, possibly in a 401 k, so that the entire amount goes to the US economy, and helps support it.

If we speculate a direct relation to the lost $50 million US that is stagnated by the wealthy person, on a one-to-one basis, roughly five hundred people are blocked from employment at the $100 thousand dollar level by this person's behavior. Or one thousand lose employment at half that level, where $50 thousand US is still middle-class.

But where do you draw that wage line then? My guess is that in a full theory it will follow a mathematical curve. So a mix of people at various levels will be unemployed as a result of the stagnated wealth. Usually one starts with the gaussian distribution, which most know as the bell curve. But I'm not going to play with any math here.

That this concept can be mathematized though could mean that economists could.

Interesting, then you could potentially look at a spike in unemployment to get numbers with which you could actually calculate how much money is being stagnated.

Of course there may not be a one-to-one but that's easier to consider for admitted speculations. If this line of questioning is correct, then the actual correlation would be of extreme interest.

So there is an easy to discuss practical use then for an economic theory of this type as if these ideas are correct, they could tell you how many people become unemployed when a wealthy entity stagnates wealth by sitting on it. Governments might penalize such behavior.

And I'm all for a person keeping what they made, and getting a benefit from it, so I'm not someone who looks to higher taxes as a solution! But the tax argument may be far less relevant anyway.

Another way that curbs in monetary flow can lead to higher unemployment is when a worker is underpaid, like say someone makes 80% of what they should make on a job, based say on what others generally make doing the same work, assuming no drop in quality simply that the person is unable or unwilling to get proper pay for his or her work. From this concept that 20% that should have flowed into the monetary supply for the community is simply destroyed money. So it's not even locked up like in the prior example, it's simply destroyed. Which is weird.

But imagine a small village where a wealthy powerful man, has armed some as he begins to slowly stop paying other villagers until he pays them nothing, but his armed ones force them to work, so that they are now his slaves. And not surprisingly the village store goes out of business! Because none of them have any money, so that thought experiment to the extreme helps to understand at the 80% level.

So underpaid workers actually directly destroy money, under this speculation on the basis of that thought experiment. So they lead to unemployment whether they wish to do so, or not, and governments should work to ensure they don't do that whether they wish to work for less or not.

It could also mean that criminalizing deliberate underpay of workers is an option for governments as underpay directly destroys money, and in so doing leads to higher unemployment, by shrinking the money supply.

So that was fun. It may take a while to firm this up into a consistent framework. But also need some real world information. Theory is worthless without supporting data.


James Harris

Friday, May 29, 2015

Contemplating work, agriculture and our employment future

For most of humanity's existence, finding food occupied the bulk of human activity, and was surprised when researching this post to read that four years ago agricultural activity still accounted for 1/3 of human employment globally. But less than 2% in countries like my own, the United States:

As of 2011, the International Labour Organization states that approximately one billion people, or over 1/3 of the available work force, are employed in the global agricultural sector.

Source: Wikipedia Agriculture--Workforce

Doubt much has changed since, though guess there's a lag in someone actually figuring out such information, so will go with those figures.

Less than 2% of the workforce needed in my country for agriculture? Versus the bulk of humanity if you go far enough back? And it occurs to me that what most people call "work" has changed dramatically.

So what is work?

While I would like to call it human effort, especially difficult human effort like writing something that people find informative, I think functionally employment is needed for a useful definition, and money. So I'll say that generally when people use the word "work" when it comes to employment, they mean efforts done in some kind of socially limited contract for someone else, for some amount of money.

When you consider how societies shift as to employment it makes sense to me it's driven by: who pays whom for what?

You could find someone making lots of money restoring antique furniture, or writing, or making a lot less, restoring furniture, or yup, writing. Actually you often see people making nothing for writing. Like me here.

When people DO make money for writing it's all about the market.

The good news with this assessment is that employment in the future will be driven by what people with money need other people to do for them, and how much they monetarily value it, as well as, of course, what other people are willing to do on a limited contractual basis.

So robots will no more necessarily unemploy everyone than agricultural machinery did.

What does unemploy people?

Other people unwilling to release favors.

I came up with a favor definition for money, seeing it as merely a social IOU, which is an abstraction enumerating a favor. But if a group of people simply gather IOU's without releasing them by using them--that is, buy something or hire someone--then that system is broken.

That doesn't impact normal savings like a rainy day fund or retirement savings though as eventually the bulk of that will be released. Only a tiny percentage of people can just lock up vast sums of money indefinitely with no pressure to release that money. That is, have vast hoards of wealth which they do not need. And that doesn't include investments either, like into new businesses, as that helps drive the system. Am talking about money that is in essence simply locked away.

People who somehow gather favors without ever releasing them, end the system, for those favors.

So vast concentrations of stagnant wealth may reflect a flaw in the abstraction of the monetary system, and apparently lead to vastly higher unemployment, presumably because fewer people are able to pay other people to do things for them.

What people do for each other on a limited social contract seems to expand as possibility expands, if unconstrained. Which is what happened as agriculture dwindled as the bulk employer and you can see the vast array of jobs available today.

So then I can postulate that unemployment is actually an indicator of a problem in the flows of the monetary system. It reveals it. Fascinating.

That's not really intuitive. But IS consistent with prior ideas, as I considered how Henry Ford greatly helped the global economy.

And it really is kind of odd, as I'm saying that those who give favors doing things for others, and receive the social IOU that we call money in return, if they don't allow others to do them favors and hand them money in compensation at a high enough level, they shut down the monetary flow for those favors. It's kind of an odd thing to contemplate.

So there can be a hitch in the monetary system. Vast sums of abstracted favors can be received by some entities which not releasing them back, constrain job creation.

Good news though is that even in a totally automated society people can be fully employed--finding things that strangers can do for each other on a limited contractual basis.

So each of us simply must find things we wish to do, which someone wants done, to establish limited social contracts which both parties find agreeable, to get to a monetary exchange. Yeah, people will keep doing that indefinitely.


James Harris