Of Marshmallows and the Economy

There are two kinds of people, those who eat one marshmallow, and those who eat two. So says Scott Sumner, a libertarian economist, who relates the results of Walter Mischel’s psychological experiment on 4-year olds and chewy goodness to current attitudes on government entitlement programs.

Forty years ago Mischel, an American psychologist, conducted a famous experiment. He left a series of four-year-olds alone in a room with a marshmallow on the table. He told them that they could eat the marshmallow at once, or wait until he came back and get two marshmallows. Some eat the marshmallow immediately. Others try all kinds of strategies to leave the tempting treat alone.

Nothing surprising there. The astonishing part was the way that the four-year-olds’ ability to defer gratification was reflected over time in their lives. Those who waited longest scored higher in academic tests at school, were much less likely to drop out of university and earned substantially higher incomes than those who gobbled up the sweet straight away. Those who could not wait at all were far more likely, in later life, to have problems with drugs or alcohol.

Sumner goes on to explain that what bothers him is when he sees attempts to redistribute wealth from the two marshmallow eaters to the one marshmallow eaters. Being a two marshmallow guy myself, it’s certainly easy to relate to the frustration of needing to support those who lived in the moment without planning for their futures. Sumner’s point is that it’s not fair to the two marshmallow crowd to cut their Social Security benefits because they don’t need the income.

Social Security is a good thing in that it forces the one-marshmallowers to prepare for a future they wouldn’t otherwise consider until it was too late. It puts the burden on them, rather than having them be indigent burdens on society in their twilight years. But the two-marshmallowers who have accumulated some wealth over the decades are equally entitled to enjoy the fruits of their contributions to Social Security. The program’s current method of allocating benefits based on lifetime earnings preserves equity between the one-marshmallowers and the two-marshmallowers. But noises are being made in Congress for changes such that accumulated wealth at retirement would decide your level of benefits, and this would unfairly punish the plan-ahead crowd.

Sumner then goes on to say, “I don’t trust the Dems—I see them as the party of one marshmallow eaters.” It is here that I think he runs off the rails a bit.

Democrats certainly have the reputation for backing entitlements and social safety nets that keep the one-marshmallowers from economically melting in the campfire of life. But the Republicans are prone to their own brand of short-sightedness. If the country were a chess game, the GOP would never play more than one move ahead. From issues as diverse as deregulation, pollution, education, taxes, infrastructure investment, and foreign policy the Republicans are pocketing short term gains with little to no regard for the longer term implications.

While the marshmallow analogy is instructive, it’s not at all clear there is a clean party line to draw between the two groups. If anything, the politicians of both parties are thinking far too much like one-marshmallowers. Two-marshmallow types are capable of sacrificing now in the interest of a better future. There are scant few policies proposed that meet that definition—fewer that are not dead-on-arrival once the news media starts spinning them to the public. As a country, deferred gratification is not our strong suit.

Zediva tweaks the nose of Hollywood studios

DVD Monkey — A peek behind the curtain at Zediva's operations center.

A new video on-demand service called Zediva was introduced this week. It’s kind of like if Netflix and Redbox got together and turned Slingbox inside out. The key feature of the new service is that you can rent new movie releases without ever leaving home. They are employing a delivery method that appears completely legal, but is sure to get the movie studio executives running hair-on-fire to their legal departments looking to find some means to stifle them using copyright law..

The consumer advantage is access to a movie selection similar to Redbox or Blockbuster, including the latest DVD releases. That’s something neither cable or satellite video on-demand services, nor streaming services like Netflix are able to offer. You see, Hollywood studios impose a release window around new DVDs such that streaming services are not allowed to play them for a period of time. The theory being that this allows the studios to get people to buy DVDs, on which they make a tidy sum. Studios correctly assume that if you could watch the movie without getting off of the couch, you would opt for that instead. Meaning, if you’re in a rush to watch a new release, you either buy or rent a physical disc, or (heaven forbid) download a pirated torrent.

Zediva gets around that release window by actually buying DVDs and renting them to you. However, rather than having to wait by the mailbox or run to the store for the disc, Zediva helpfully pops the disc in one of their networked DVD drives and streams it to your house over the Internet. The key being that during the playing of the movie, that DVD and player are only playing to you, the renter.

Thanks to legal precedents established when Slingboxes were introduced years ago, place-shifting is perfectly legal. In the case of Slingbox, it was ruled that copyrights couldn’t prevent you from sending video content to your phone or remote computer from a box located in your house. You were paying for the content, and studios couldn’t restrict you to watching it locally, as long as you weren’t sharing or reselling it. It’s hard to see how this is different. Zediva is a DVD rental store, nothing more. They just provide Slingbox-like capability (also legal) to allow you to watch the movie remotely.

The initial popularity of Zediva is huge. They have already cut off new registrations as the demand for the service has far exceeded their capacity. Thus it seems enormously likely we’ll soon hear the screams and howls from the studios of how they will go bankrupt if this sort of thing is allowed to continue. (For reference, they screamed that when writable DVDs were introduced… and VHS tapes… and color television… Hollywood? Still solvent.)

Yet, there is a larger message here that should not be lost. The Zediva model is clever, but technologically stupid and inefficient. It exists only to do an end-around to existing copyright rules put in place to prop up dying business models. These are business models designed to create artificial scarcity and inflate prices. Zediva also illustrates a pent up market demand for access to this sort of content. People want the convenience and are willing to pay for it.

The theory of capitalism is that some new business will come along and leverage the consumer demand, thereby driving the dinosaurs to extinction. But Hollywood studios are an effective monopoly. The barrier to entrance in that business is huge. So the reality is that as long as they stick together, they can continue to abuse consumers in defiance of capitalist principles.

Kudos to Zediva for finding a way to give consumers what they want, but they may want to open up that legal defense fund now, just to get a head start.

Your car now needs a different kind of firewall

Growing up in my father’s auto repair business, I came to understand that a car’s firewall was that piece of the body that separated the engine compartment from the passengers. Back in the day (as my teen son is wont to say despite sporting such a paltry number of days), this was pretty essential hardware as engine fires were not uncommon. The advent of several safety systems as well as the demise of carburetors has made such fires comparatively rare. But modern digital automotive systems now have different safety issues requiring a different sort of firewall.

Security experts from the University of California, San Diego, and the University of Washington have successfully hacked into a car’s onboard control system using a variety of attack vectors. In one case, they used a car’s cellular connection (similar to OnStar) to access the vehicle’s computer. In another, they took control using an Android phone connected to the car’s Bluetooth interface. In the third case, an MP3 music file, loaded into the car’s sound system, was infected with a Trojan that successfully loaded itself into the vehicle’s firmware.

Now in your average car, there is a limited amount the hacker can do once he gains access to the firmware. He could futz with the fuel mix and mess up your gas mileage, or change all the presets on your radio. While this is annoying, it’s not terribly dangerous. It’s also not interesting enough to warrant the efforts of would-be hackers unless this is their thesis project.

However, many higher-end cars may be unlocked, started, or in the case of vehicles with a self-parking features, even driven away under computer control.

While this is a scary prospect, it mostly reflects car designers not yet realizing the impact of networking the vehicle control systems. Cars will simply need to employ the same sorts of firewalls and security software used by other computer systems. Which also means the same sort of constant updating to address more recent exploits and attack vectors will also be required.

Ironically, I left the automotive field to pursue a career in computers. I know my life will have come full circle when the first family member calls because their car has a virus.

Michele Bachmann sponsors bill to make English mandatory

Minnesota’s Queen of the Clueless is co-sponsoring a bill to make having a command of the English language a requirement.

While the intent is to make sure those damned immigrants git learned good English. The reality could be that several prominent Republicans would lose their rights as citizens. Perhaps I misunderestimate the scope of the bill, but so far no one has refudiated my point. And even if they do… well, you spell potatoe; I’ll spell potato.

Along with Iowa Rep. Steve King, Bachmann asserts that all official government business must henceforth then be conducted in English. They warn that without such action, there’s less hope of immigrants becoming real Americans. And the last thing we need is any more of those fake Americans clogging up the aisle in the Wal-Mart.

“To declare English as the official language of the United States, to establish a uniform English language rule for naturalization, and to avoid misconstructions of the English language texts of the laws of the United States.”

The bill is purporting to address problems we simply aren’t having. In 2004, the Lewis Mumford Center for Comparative Urban and Regional Research addressed exactly the question of whether immigrants and their children were language assimilating. They found that English is almost universally accepted by the children and grandchildren of the immigrants who have come to the U.S. in great numbers since the 1960s. Moreover, by the third generation, i.e., the grandchildren of immigrants, bilingualism is maintained only by minorities of almost all groups.

Yet bills like this are popular with the Tea Party crowd. They play on the ignorance, xenophobia, and fear of people who forget that not so long ago, their parents and grandparents were the immigrants who spoke funny. Ironically, Minnesota was founded largely by Swedish and Norse immigrants, who in the early days of the 20th Century posted voting instructions in a variety of languages to accommodate their diverse population.

It seems Bachmann’s own grandparents immigrated from Norway. I wonder how good their English was and if Michelle thinks Grandpa shouldn’t have been allowed to vote?

I can’t hear you, I’m eating

Sometimes technology comes up with odd things that are way more useful than tools for hygienic espionage. Case in point is the new SoundBite dental hearing system.

Bone conduction systems have been around for awhile now, and are effective at restoring hearing when there is damage to the auditory nerve of only one ear, but the other is working well. In such cases, conventional hearing aids are useless. However, existing systems require an external device to be bolted on to the side of your head.

Okay, that probably is an overly dramatic description, but as someone who has complete loss of hearing on one side, when they explain they are going to attach something to your skull with a drill, that’s kind of how it sounds. At least so far, that solution isn’t more appealing than suffering the loss of all spatial hearing ability.

However, this device requires no surgery or permanent attachment of any kind. The receiver unit is molded to your teeth and just pops in when you use the device. It wirelessly picks up signals transmitted by the small microphone clipped behind the decorative ear, and passes the sound into your jaw where it resonates into your head for the other ear to hear.

Apparently, with enough practice, a user can regain a good share of their spatial hearing. It would certainly be nice to not have to spin around in circles looking for who’s talking any more, or have to turn my head ridiculously far around to hear a quiet comment from the person seated to my right. Unless we’re eating I suppose. Then the device would be in my pocket and I could still only hear half the table. Then again, maybe I’d be so riveted by the conversations around me I’d eat less and listen more. Yeah… probably not.