Best economic lessons I ever learned

I was thinking today about the idea of sticking all of the most important financial advice onto a 3×5 note card. A few ideas came to mind.

  • Pay off high interest debt as soon as possible (high interest > 8%) but not low interest debt if the alternative is investing in higher interest assets
  • Take employer matching IRA contributions as much as you can, they’re tax free and can be quite large.
  • HELOCs can save you hundreds of thousands of dollars compared to mortgages and you can own your home 20 years earlier with the right strategy.
  • Take rewards with your purchases whenever you can (just pay your credit card off at the end of the month), it can pay up to 4% cash back on every purchase. Free money.

This is true, these are the best pieces of advice I have ever received… some of them from school, some from friends, some from life… But when you get down to it, all four of these are really the same thing…

  • Cost benefit analysis

Cost benefit analysis, look at the costs and benefits of every decision you make, and make the decision which is the best.

That is the most important lesson I ever learned in an economic class.

Ukraine in context

I saw this tweet today and naturally it got me thinking about how racism in our society is constantly perpetuated in all spheres of our modern world. People are very good at othering others. We saw this type of behavior when it came to acceptance of Syrian refugees, but now that Ukraine is being invaded Europe opened its borders almost instantly. In response to Syria, it created an entire military to sink their ships in the Mediterranean.

Perhaps part of this is Europeans claiming to expect that Syria won’t improve and that Ukraine will. But I believe his notion is absurd, racist, and wrong.

There might be a reason to deny visa free access to countries which are underdeveloped… maybe. The argument for visa free access is simply viewing movement as a human right. The argument against visa free access for everybody is it could potentially create brain drain and the only people left in the original country will be those who are too corrupt or too poor to leave. I am not convinced either way on that issue. There is no reason to deny visa free access to countries which are fully developed however when there is every reason to expect people will go home. We see there are numerous countries which are highly developed which the United States still requires arduous visa applications in order to travel to. The Schengen Area is better on this topic. I do believe that visa restrictions are too common today and more countries should be able to travel without visas.

If we look at a list of countries which are currently at war, most of them have a democracy score under 50, and have low incomes. Ukraine, Colombia, and Mexico are the richest countries which have ongoing conflicts with over 1000 deaths this year or last year as of today. It’s pretty hard to ignore the trend that as wealth increases, corruption decreases, and inequality decreases, violence decreases. This means one of the easiest ways to reduce violence in the world is to target these three metrics (wealth, corruption, inequality) and then the world will be a more peaceful place. That’s what the data suggests.

 

This goes back to something I keep coming back to again and again. If you want peace, you need to democratize and develop your economy. If you want to have freedom of movement, you need to democratize and develop your economy. We need fewer tyrants with resources in the world, support emerging democracies, and make sure that they have the tools they need to rapidly develop in environmentally sustainable ways.

 

Also, it’s common knowledge in economic circles that oil doesn’t just erode the environment, it also breeds corruption, inequality, and degrades democracy overall.

 

What can we do here at home? Well, first of all we can improve our democratic institutions and move towards decarbonizing our economy. The best way to improve our democratic institutions right now is to implement ranked voting so we can kill the spoiler effect. The best way to decarbonize our economy is through a carbon tax. In order to help people from Less Developed Countries we need more people from those countries to come to the US and EU to study so they can bring cutting edge science and knowledge of politics back to their home countries.

Go get involved with FairVote and Citizens Climate Lobby right now!

Also, travel and meet people from other countries and start to grow a movement to build real visa free travel and eventually have the US and Canada join the Schengen Area.

Better democracy through ranked voting.

Better international relations through more people to people connections (it really works).

Fight for policies to improve our climate quickly and efficiently. AKA carbon taxes.

Our politicians need to let Ukraine and Georgia into NATO ASAP along with any other democracies which want to join.

We have been seeing democratic backsliding for the last few years. We can reverse it. WE MUST REVERSE IT.

That’s what we can do today to prevent future conflict.

Peace is a policy choice

Today saw the launching of the largest war in Europe since 1945.

We must keep track of why there was so much peace in Europe over the last 77 years. It wasn’t because the leaders of Europe were all angels, some of them (particularly Stalin) were truly terrible people.

It was because there was a mutual defense pact between all countries which were not occupied by the Soviet bloc. After World War II every large country in Europe, except Albania, Austria, Finland, Ireland Sweden, Switzerland, and Yugoslavia were part of either NATO or the Warsaw Pact. Finland and Sweden are part of the Nordic Council, and Austria was an important neutral state through which Russian natural gas flowed to Western Europe. A necessary hole in the iron curtain for trade to flow. Albania and Yugoslavia were communist. Switzerland is an important banking center for both sides. Ireland was protected because of geography.

https://upload.wikimedia.org/wikipedia/commons/e/e4/NATO_vs._Warsaw_%281949-1990%29.png

With almost all nations having defense pacts or being critical for international trade, mutually assured destruction wasn’t madness, but actually a promise. Any attack on another country would be met with such incredible force that it kept Europe at peace until today. The United States promised aid to any ally who was attacked, and peace was kept.

The map today is very different.

dark blue: NATO and European Union or Schengen Area

light blue: Only European Union or Schengen Area

green: Only NATO

red: Collective Security Treaty Organization

As this picture shows,the only countries of any size in Euroep which are not part of a major alliance are Azerbaijan, Bosnia and Herzegovina, Georgia, Moldova, and Serbia. Of these countries, Ukraine is by far the largest and most important country which isn’t fully part of either alliance.

In a perfect world, none of this would matter. Countries would be allowed to make their own decisions, and people would be allowed to follow consent. That’s not what is happening however today as Russia invades Ukraine.

There are two ways towards peace in this world.

  1. Every leader of every country is an angel
  2. A web of alliances makes war extremely expensive where even the smallest countries are protected by defense pacts

We obviously don’t live in the first world, so we must build the second.

In the past, due to a complex web of alliances, this is not the reality.

 

The current Ukrainian crisis started in 2008 when Georgia was invaded by Russia. This war ended

It escalated and reached Ukraine when the War in Donbas started in 2014. The United States threatened to send arms to the Ukranians if the Russians didn’t back off, so they did. Russia didn’t want and does not want to get NATO involved. It was clear that if Russia continued their aggression that the United States would get involved deeper with the rest of NATO until Russia stopped under the Obama administration. They backed off, but were able to keep two regions in Eastern Ukraine under occupation.

Then we come to the Trump administration, and we know for a fact he was supported by the Russian government from the very beginning. Trump signed a treaty with the Taliban giving them Afghanistan, without any input from the Afghans. This sent a major shock to the credibility of the United States. It came into effect in 2021 and the Biden administration, remarkably, allowed it to come into force.

I don’t think Russia expected Biden to win, and I also don’t think they expected him to follow through with Trump’s Afghanistan treaty. Being the second war America lost in its history, Russia made a gamble with Ukraine. They were wondering if Biden was willing to lose Afghanistan, given his clear desire to focus on harmony and unity at home whether he would care about Ukraine. The Budapest Memorandum is clear that if Ukraine is attacked with nuclear weapons that they will have aid. It is vague when it comes to non-nuclear war.

Over the last few months Putin took a gamble. He started amassing troops along the border with Ukraine several months ago and there was no response from the United States or the European Union. No sanctions, no repercussions. That is when the embargo and sanctions needed to begin, to show him that we are serious at protecting our friends. Allowing Ukraine into NATO immediately in the last week of peace in Europe would have been enough to prevent the war.

But NATO did nothing.

Given that Putin was apparently allowed to station his troops on the border, and that NATO would not respond negatively to this, he saw the green light (in his eyes) towards invading Ukraine. Putin announced his deranged speech a few days ago which is when NATO could and should have responded swiftly in response to his madness.

But NATO did nothing.

So Putin attacked Ukraine in a full blown attack with the singular goal of bringing Ukraine under his full rule yesterday, a move which he had been building up to for months. In response to this several countries have started sanctions against Russia.

But I fear it might be too late for sanctions and economic repercussions.

Putin is a megalomaniac, not unlike Hitler (who my family suffered under). He responds to force alone. The threat of taking him out of power through would have been enough to stop him, it worked in 2014.

Fast forward to 2022. The world is a different place. Obama is no longer in office and Biden is now President. Biden is one of only two Presidents to ever lose a war while sitting in office (the other is Ford) and Putin saw this as his opening to attack. Biden talks about unity more than anything else, and attacked progressives when members of his caucus were attacking his bills. This misfiring and losing of major bills and a war gave Putin the signal.

In the past, it has been the United States which has been the major player in NATO. The United States comprises the largest military in NATO by far, making us its de facto leader. Because of this in the past when Putin has played war games it has been the mere threat of repercussions from the United States which has kept him in line. These threats are followed by treaties and he was unable to achieve his goals. We saw this in 2008 with the Georgian war and 2014 with the War in Donbass.

Russian observers at this point understand Putin. We understand he is an anti-democratic tyrant and he only responds to force. He sees treaties without a military as just paper, and treats them as such.

Biden’s career focus on “unity”, losing of the war in Afghanistan, and losing voting rights and BBB with a congress which has a de jure Democratic Trifecta has given Putin the green light. He sees Biden as a weak old man who can’t get even his own party to stand in line and attacks the wrong members. If he so misunderstands his own party that he fails on what he claims to be his most important bills, then in Putin’s mind, why should he expect Biden to be a strong leader of NATO? Especially when Biden has clearly shown that he doesn’t care about immigrant children in prisons, or appropriately resolving the conflict in Afghanistan. The Chancellor of Germany is new to the job, he only came into office in December. The Prime Minister of the United Kingdom is anti-European to the core. Canada is suffering from anti-vaccine hysteria from truckers who are listening to Fox News (which pretty clearly is tied to Russia).

This is why Putin started massing troops on the border of Ukraine. He was testing us to see if Biden, Scholz, Johnson, Trudeau, or Macron would act strongly in response. He got no response. Now that he is invading we are threatening him with sanctions, but it is probably too late.

I don’t want war. I want to live in a world where people are free to live their lives peacefully, and that can only exist if every leader is an angel or dictators like Putin are held back because their targets have powerful networks of allies.

But we clearly don’t live in either world. We live in the world where Putin is able to attack a country and the countries which have been saying they are friends of Ukraine for years don’t have an immediate plan ready to go immediately.

If we were to attack Russia, and they went nuclear, than we have anti-nuclear missile defense systems which will spring into action. If those systems do not work, than that means the Iron Dome over Israel won’t work, and South Korea is vulnerable from nuclear attack from North Korea (if they get a nuclear bomb which actually works) or just from more conventional weapons. I highly doubt that with over $10 trillion spent on military by the United States since the Georgian War of 2008 that we haven’t built sufficient anti-nuclear bomb systems in Eastern Europe to protect us if Putin launched an attack. This was an initiative of the Bush administration. If we don’t trust those systems, than we just gave the green light to North Korea and Iran to attack South Korea and Israel. I bet those systems work.

If we don’t protect Ukraine from Russia, we just showed that the Bucharest Memorandum is worthless, and American treaties in general are worthless too. It means our word is not worth the paper it is written on, and it is the green light for any of our adversaries to attack allies like Israel, South Korea, and Taiwan, because America doesn’t feel like defending our allies. That is a dangerous world where small democracies can be conquered by large authoritarian states.

This is the world we live in. Tomorrow NATO will meet and discuss the situation. The following criteria must be met:

  • Our anti-missile systems must be effective, otherwise Israel and South Korea are screwed.
  • We must make sure that our treaties are worth more than the paper they are printed on.
  • Putin needs to step down and back off of Ukraine or we will respond and protect our friends.
  • Ukraine and Georgia need immediate NATO membership.

 

Simply giving Georgia and Ukraine NATO membership tomorrow will probably end the war in an instant. Putin knows he will lose that war.

Giving them NATO membership is peace as policy.

Experience is complicated

There is a tendency in technology nowadays to require x years of experience in some technology in order to get a job when you start out. I am fortunately past that stage myself, and have observed why the current conventional wisdom is foolish, and we need to move to a different hiring paradigm.

Let’s say you are interviewing several candidates for one job.

  1. Candidate A is fresh out of school. Could be a boot camp, could be college. It doesn’t really matter (when I did my boot camp some of the PhDs in the class were remarking how difficult it was). They have an extensive portfolio of using various technologies which are relevant to the role in the target language. They have learned their stuff and have over 10 projects demonstrating fluency in their language. They built all 10 projects over the course of 12 months.
  2. Candidate B is in the middle of their career. They have only been doing the target language for a short amount of time, their work in the target language is extremely limited, and their portfolio is extremely sparse when it comes to the skills you are hiring for. They have evidence of deep expertise in other languages stretching over a decade, but not in the target language.
  3. This candidate is fresh out of school, but they don’t have a portfolio. They say they know the target language. You have no access to anything to prove their claims.

 

Candidate A is ready for the role. They could use some coaching on how to lint their code properly, but that can be taught. Candidate B might not be ready, their depth is in another area of expertise. Candidate C needs to build a portfolio to prove their skills.

 

The problem with the modern hiring paradigm is that it will usually ignore candidates A and C, give candidate B a major lead role in an area they have no expertise in.

What should happen is that they should find a candidate with experience in the target skill set, who can prove they know the language with code which works and passes a simple linting test. That person should be the new manager. The more impressive the project, the better. Candidate A should be hired to a junior role with real responsibilities. Candidate B should either be a non-management role (because being a master web developer does not make you a data scientist, obviously) in the target team or moved to a team where they actually have expertise where they can be a manager. Candidate C should be given a polite letter asking them to construct a portfolio before they apply again. Give them direction on where to go.

This is the problem with most modern hiring practices. They don’t use tools to accurately assess the expertise in the target job, quickly discount candidates who should be hired to a junior role, and often people with years of expertise can be promoted to roles where they are out of their depth. This creates failure.

We need to rethink the entire hiring paradigm. If somebody is able to earn a college degree or pass a bootcamp, they have a good work ethic, full stop. It might make sense to hire all new employees on as temps and then promote them to full time salary in 3-6 months if they prove they are valuable members of the team, but to simply tell people starting in any field that they don’t have “experience” for a role which is labeled as entry level is absolutely absurd.

A college degree is proof of a good work ethic. That’s all you need.

Then you need to see if the person is a good fit for the company. Hire people on for 3-6 months as an hourly employee, and if they work out, give them a salary and full benefits. If they don’t, then it didn’t work.

Put people in places which match their expertise in the skills they demonstrate in their portfolio. If someone has an extensive data science portfolio where they use machine learning to answer questions, don’t put them in a sysadmin position (even if they are capable) place them in a position where they will use as many skills they have demonstrated as possible.

Years of work experience is a meaningless metric, and it is long past time that companies stop using it to determine whether someone should be given an interview. I am planning on developing tools in the future to better assess whether someone has skills better than the methods I have observed in my life so far, but what I do know is that the current system is inefficient, doesn’t promote people who need to be promoted, promotes people out of their depth, and doesn’t hire people who are perfectly capable of doing the job in question.

To be continued.

Common Python pitfalls

Here are mistakes I have observed which lead to broken code.

  • Python is not Java, C, or C++ and needs to be treated as its own language.

Treating it with the same syntax is a sure fire way to make broken code. Java and Python are both object-oriented languages. French and Italian are both Romance languages. You can’t walk into a pub in Milan speaking French or a pub in Bordeaux speaking Italian and expect people to understand you. English with German grammar means people think of you weird will. For the same reason, you cannot try to render Java code in your Python renderer and expect it to work. It has to be fully one way or the other. Take the time to learn the target language, use a linter, and you will  write better code.

  • Value equality vs reference equality. == and is are not the same! What are the differences? What happens if I use the wrong one?

This goes back to C. In C there are pointers, which points to places in memory. This is a reference equality. In python this is represented by the function is. The other value equality is asking if two objects have the same value. In complicated code, this can become very important, particularly when dealing with users input.

For more details on how this can break code quickly, please look through this helpful notebook I wrote.

  • Close your statements, these go bump in the night, hard to trace, waste time, break your code

Modules are wonderful. Modules make it so that instead of writing out every piece of code every time, you can import a module to do what you want reliably and quickly so you can get to the money making code.

Modules also have dependencies, and will often use the same dependency. For example, Pandas uses csv as a dependency. If you try to open a file with the csv module, and then use Pandas on the module, you run into a problem because its already open. You can prevent this problem by not keeping functions open.

If you want to write to a file, don’t do this:

import pandas as pd
file = csv.reader('random.csv')
file.write('pizza,anchovies,tomatoes')
pd.read_csv('random.csv')

Since Pandas imports CSV this is going to fail, but it won’t give you a clear error message. This is dangerous. Always close your statements. Using established modules prevents this problem because they are used by millions of people every day.

  • Try to use the exceptions correctly, how can this break your code? Those who hide errors pay the price

Exceptions can be very useful if you need to fail in a particular case. They also are the worst bugs you will ever find in your life, especially if they hide debug to fix your code. If you use code in a way which explicitly states which exceptions you use (when necessary) and use if statements when possible, then errors which occur in dependencies won’t get buried and your debugging experience will be far more pleasant, less time consuming, and fruitful.

This is a new idea to Java and C developers, but it really does prevent many hours of tedious and unsatisfying work.

  • Default to 0 when data doesn’t exist, a great way to screw up your data and waste hundreds of hours of expensive developer time

They’re different values. Just don’t do it. It makes it impossible to filter your data accurately. It makes dirty data. It wastes time. You will regret it.

  • What happens if I don’t use the Oxford comma?

If you ever want to split a string into a list, you will very quickly learn to love the Oxford comma.

  • Reassign built-ins

Reassigning built-ins can mean that if you try to use the built in, either explicitly, or in a dependency, that it will go to what you assigned it. Just. Don’t.

  • Why not to use System Python, and how to have stability by using virtual environments

If you plan on using the computer for an extended period of time and the system updates, it will change the python dependencies on your computer. This can make it so version incompatibilities arise. Using virtual environments containerizes your code so your operating system won’t change it and gives you full control. It only takes one time to have all of  your dependencies screwed up to learn why you should use virtual environments and containers.

 

Hopefully these 10 pitfalls will help you write better code.

What does International Relations teach us about Ukraine?

The world stands on a precipice right now. The question is whether Democracy will stand or whether it will fall. Russia is massing troops on the border with Ukraine, threatening a war (it’s the only reason a state ever does this military maneuver, let’s be honest) and now its NATO’s turn to act.

There are two major schools of thought in international relations, and each of them have lessons to teach us about what will happen next. They are the liberal school of thought and the realist school of thought.

The liberal school of thought believes that democratization, trade, and dialogue help mitigate conflict. The basic idea is that countries which are engaged in trade are less likely to go to war. Also, democracies are also less likely to go to war. Research supports both theories. Non-state actors matter, and international institutions matter. Read the Wikipedia article for more detail.

But the liberal school of thought fails in the Russia case fully, because Russia trades a lot with Europe, which brings in large amounts of cash in exchange for natural gas and oil. It is useful only to a point, and isn’t enough to really understand what is happening in the world right now.

The other major school of thought in international relations is realism. TLDR, states are the only institutions which matter, the international system is anarchic, states act within their own rational self-interest, and states desire power.

Now this does explain Putin’s behavior closely.

Now we have to focus on for multiple reasons the people of Ukraine do not want to be part of Russia. They used to be occupied by Russia, and 80 years ago over 10 million Ukrainians died in a famine caused by the Soviet government (which of course was dominated by Russia). For that reason in particular, Ukrainians have a lot to lose and nothing to gain if they are invaded and annexed by Russia.

So looking deeper into realism international relations theory (the relevant school of thought in this scenario) it discusses what happens when states face a hegemon together. In the absence of American leadership, Russia is without a doubt a hegemon over Europe. With the United Kingdom trying to distance itself from Europe (a geographic impossibility) we must realize that Russia has a population as large as Germany and France combined. Germany and France are the richest and largest countries in the European Union, and they equal Russia’s power. If Russia invades Ukraine and the European Union defends, it will be a long and bloody war. If the United States joins it will be relatively short. We’ve seen this before.

If you look at a map of Europe in 1960, half of the continent was capitalist, and half was communist. Today, the map looks like this:

Dark blue: European Union/Eurozone

light green: European Union, no Euro

light blue: candidate countries

light purple: Central European Free Trade Agreement

Dark purple: Schengen Treaty

Red: Union state

Half of Europe used to be under Soviet control (de facto). Today the only satellite state Russia still controls in Europe is Belarus. Georgia wants to be a member of the European Union and NATO, as does Ukraine, and Azerbaijan is part of GUAM with Georgia, Ukraine, and Moldova. This leaves Russia with influence over only Armenia.

It didn’t have to be this way. If Russia had democratized and respected freedom of the press, Europe would be more than willing to have deep ties with the largest country in the peninsula. Democratization would have certainly led to economic growth, and a reduction in inequality, and Russia would be far better off than it is today. Unfortunately over the last 22 years Putin has done everything in his power to stop all political opposition, actively used his foreign diplomacy to undermine democracy abroad, and has repeatedly threatened democracies on the periphery of his empire.

It’s a real shame, I really believe that if Russia were to democratize it would prosper economically, Western Europe would happily build democratic integrations with Russia, and there would be peace in Europe where disagreements would be solved through dialogue, and frequent trade between countries would make no real economic benefit for anyone to attack each other.

But this is where the whole situation gets really confusing (at least from a liberal point of view).

Russia has three major gas pipelines which pass through Ukraine into the European Union. Even the South Stream pipeline passes through Donetsk (which probably explains why Russia wants to capture that territory in particular) Russia and Ukraine are already deeply intertwined politically, and Russia is absolutely dependent on Ukraine for its own economic survival. If you cut off the gas pipelines into Europe, Russia will fall into an economic depression overnight. Russia is absolutely reliant on good relations with the rest of Europe. While it is of course difficult for Europe to cut ties with Russia, because of their reliance on Russian natural gas this also explains another part of Russian strategy. it is the depths of January right now with Russia attacking Ukraine. The last attack on Ukraine in 2014 was in February. Russia does not attack Ukraine during the summer because at that point Western Europe can survive if the gas is cut off for a few months and Russia’s economy tanks. The timing of Russia’s military invasions into Ukraine is no accident, because it reduces Europe’s ability to retaliate through economic means.

Russia has invaded their former colonies twice before, and there is no reason to expect that they will not stop right now without significant pushback from NATO and the European Union.

The main point is it is clear that Putin is not content with just having economic ties with his neighbors, he wants political control. He believes Eastern European countries have a choice, be in Russia’s sphere of influence, or Germany’s sphere of influence. He is stuck in a Cold War mindset, unable to see past his KGB training, and that is what makes him such a dangerous person.

It’s also important to understand that Germany has a new chancellor, Olaf Scholz, who is also the first SPD chancellor in 17 years. Both Scholz and Biden have never had to deal with Putin invading a NATO candidate before. Putin is testing both politicians in a very dangerous game. On top of this, America’s surrender in Afghanistan has made Putin wonder whether Biden will defend his allies at all. Since we know Biden let Afghanistan go back to the situation it was in back in 2001 when the twin towers attacked, how will Biden respond when a country in Europe is attacked by the largest country in Europe? With the United Kingdom out of the European Union as well, Putin has divided the west. There is a lot of evidence pointing to Putin wanting to separate Britain from the rest of Europe. On top of this, we know that Putin supports internal opponents of European Union integration. By sowing discord among people in Europe, supporting candidates like Trump, la Pen, Alternativ fur Deutschland, and possibly Johnson, Putin has been attacking the foundations of democracy in every major NATO member.

A quick search on Google shows there have been mixed messages from Ottawa and Washington, and the only major leader in the West giving a strong line on support for Ukraine is Macron. If the rest of the Western Alliance of democracies (NATO) gave a similar strong message that Putin should not mess with Ukraine, Putin would probably back down. Almost a billion people live in the member states of NATO today, Russia would be crushed if they were to go into a direct conflict with NATO, and China does not want to cut its ties with the United States. Russia knows this. But, with an American President who surrendered Afghanistan to the Taliban, a British prime minister who detests Europe, along with mixed messages from Berlin and Ottawa, what might be perceived as a desire for peace by major world leaders might give Putin a free pass. But despite how much Boris Johnson hates Europe he is saying he will send troops to Ukraine. We will see if that actually happens.

But it doesn’t much looking at history to understand it has nothing to do with a general desire for peace.

In order to understand Biden’s actions we need to look at this screenshot.

Image

This picture is a snippet of the vote to invade Iraq in 2002.

This vote tells me a lot about the current situation and Biden’s unwillingness to use military force to fight terrorism or hold back Russia from invading and conquering Europe, which is what the Cold War was all about really. When the United States has not had access to a country’s natural resources, they have been more than willing to invade and start a conflict. When anti-democratic forces have invaded countries with little oil, the President of the United States doesn’t care.

Which brings us to the only reasonable conclusion.

Biden doesn’t care about world peace. Biden doesn’t care if other democracies fall. He just doesn’t want to use our military for anything besides acquiring oil reserves.

That’s the theme of Joe Biden’s half century long career. Its a pursuit for economic benefits for the richest Americans (see his history on student loans) and making America less dependent on trade. Joe Biden is a mercantilist. He always has been. He doesn’t care about democracy (hence the lack of interest in the voting rights act, which could easily cost him congress in November), and that leaves Europe on its own. The German chancellor has only been in office for three months. The first week of this crisis saw Biden downplay it. But we have seen a shift in the last couple of days, probably with pressure from European allies.

At least that’s how it looks until a couple days ago.

https://www.cnn.com/2022/01/28/politics/us-russia-ukraine-invasion-warning/index.html

The first few news reports I saw of this showed Biden skeptical of whether Russia would take this seriously and several scathing criticisms from European allies towards our President. Looks like peer pressure from our closest allies in the world has helped President Biden change his 50 year old song and we will defend our partner democracies around the world with sufficient pressure from our allies.

After all, the motto of the United States is e pluribus unum. Out of many, one. A rallying call of the Revolutionary war was united we stand, divided we fall. The United States was founded on the principle of democracy, and is the oldest standing democracy in the world. The United States is one of the only countries which turned into a democracy from armed conflict, and we should always remember that democracy sometimes comes with a cost. With NATO troops in Ukraine, this will hopefully be enough for Russia to back down and not invade Ukraine.

If it isn’t enough, Putin will likely pay with his life.

Potential Supreme Court nominees

Biden has announced he will appoint an African American woman to SCOTUS. This will be the first time there are no liberal men on SCOTUS for at least 90 years and the first time there is gender parity among Associate Justices. Here are the nominees.

She has to be under 55 to be a serious contender and on a Court of Appeals in order to be considered, and appointed by a Democrat. Presidents tend to nominate people in their 40s lately, ensuring they will have an influence for a long time to come.

Potential picks:

Those are the only 5 candidates in the United States with the experience, gender, race, and age requirements.

None of the appointees have been on the federal bench for more than 1 year, and only two were appointed justices before President Biden nominated them.

Only Ketanji Brown Jackson has been on the Federal bench more than 5 years.

I bet Biden will nominate Ketanji Brown Jackson to the Supreme Court.

Ukraine Russia game theory

I was watching this video and they showed us this graph from game theory

The answer the video said is that the US should do appeasement because of some multiplication, which isn’t how game theory works, so we will ignore that part of the video.

You go down the tree. The highest score for the United States is 0 in the entire tree. They have two negative scores.

We can ignore the first part of the tree because Russia is already acting with aggression, which brings us to our current game theory tree

The United States can either appease Russia. Ukrainian independence is lost, the West will not defend allies before they join NATO, but here’s the problem, if the United States and the rest of NATO threatens military action against Russia for their threats toward Ukraine, then we are at a point where Russia has a decision to make, The rest of the tree is no longer relevant if NATO threatens military action.

Now Russia’s action is obvious, Russia will back down, they will not fight a war they will certainly lose. NATO has a far more advanced military, with far more troops, and is far richer than Russia. Russia backs down because status quo is preferable to them than war according to the scores in this video.

Once you realize that Russia will back down once America threatens a military response, we know that Russia will always go for the status quote over war (assuming scores are correct), meaning the USA has a score of -1 for appeasement, and 0 for threatening to go to war. 0 > -1 so NATO Should threaten to defend Ukraine, knowing Russia won’t engage in a direct conflict and they will back down.

That’s how game theory works.

The dominant strategy for NATO at this point in time, according to the scores presented in the video, is to threaten military action against Russia, knowing that Russia backs down.

Welcome to Game Theory.

Will America defend NATO?

Following the end of the Second World War, relations between Josef Stalin and the rest of the world declined rapidly. Russia is by far the largest country in Europe today, and the Soviet Union was bigger still. Western Europe feared an invasion from Russia, and President Harry Truman understood that if we didn’t defend Western Europe that the United States would quickly find itself alone in a hostile world. Not just that, but the United Kingdom was still in control of the Indian subcontinent, and the idea of giving the Soviet Union potential control of India was unthinkable. It would make America alone in an incredibly hostile world if the Soviet Union were to take over Western Europe through invasion, as per Leninist ideology.

There was  already evidence that the Soviet Union would use its military might to invade sovereign nations in Europe and replace their governments with Soviet “Republics”. These were the following:

  1. Red Army invasion of Azerbaijan
  2. Red Army invasion of Armenia
  3. Red Army invasion of Georgia
  4. Soviet Intervention in Mongolia
  5. East Karelian Uprising
  6. Red Army intervention in Afghanistan (1929)
  7. Red Army intervention in Afghanistan (1930)
  8. Invasion of Poland as part of World War II (1939)
  9. Winter War with Finland (1939)
  10. Occupation of the Baltic (1940)
  11. Soviet occupation of Bessarabia and Northern Bukovina (1940, the creation of Moldova)

With 11 cases of invasion by the Soviet Union into their neighbors over the preceding 30 years, there was reason to believe that the Soviet Union would continue to expand their borders east, and if countries wouldn’t ally themselves with Russia that they would then be invaded. We can use Poland as an example where the Soviet Union setup a fraudulent election in 1947 which placed the “Democratic Bloc” in power which would remain the sole legal party for the next 43 years. Other members of the Warsaw Pact have similar stories.

Truman saw the Soviet Union occupying Eastern European countries, setting up fraudulent elections, and then taking full control of the country and by 1949 it became obvious that something had to be done. As a result, the United States setup NATO saying that an attack one on is an attack on all. It stopped the Soviet Union from attacking any more countries not already controlled by them in Europe up to the War in Abkhazia in 1991 and the assassination of President Gamaskhurdia of Georgia.

Georgia of course was not a NATO member at that point in time, and they wouldn’t join the Individual Partnership Action Plan until 2004, and Intensified Dialogue didn’t start until 2006. Ukraine is a similar story, they joined Intensified Dialogue in 2005. Because of this, the United States had no legal treaty guaranteeing the independence of Georgia and Ukraine.

Fast forward to 2008. The United States has now welcomed Bosnia and Herzegovina, Georgia, and Ukraine to be members of Intensified dialogue. Czechia, Hungary, Poland, Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia, and Slovenia are all members of NATO. Russia sees this expansion of a military alliance as an encroachment into their former colonies. The fact that these decisions were made by democratically elected governments and their joining the EU was done via a popular vote doesn’t matter to the Russian government. Russia sees itself as isolated (even though we haven’t gone to war with Russia and they still supply a large percentage of European gas and oil) and decide to test the American government to see if the Bush administration will defend Georgia.

We didn’t militarily defend Georgia. At this point is when we learned that intensified dialogue clearly does NOT come with a guarantee of military defense from the rest of NATO, and the United States will not defend any given country we have good relations with. Russia de facto annexes Abkhazia and South Ossetia as puppet states, and they prepare for their next attack.

Russia then decided to attack Ukraine in 2014, and as a result they annexed Crimea and the Donbass region became controlled by two unrecognized puppet states.

Now Russia is mounting its troops on the border of Ukraine again.

It is clear that Intensified Dialogue NATO means nothing in terms of real defense during an attack by another country. Unless if President Biden chooses to do something about it.

Biden also made comments downplaying Russia’s massing of troops on the border of Ukraine stating “There are no minor incursions” yesterday.

And today the Chancellor of Germany denied Biden’s request to talk with him directly.

Yikes.

I think what has happened is that Russia has seen that America gave up the War in Afghanistan, which is now an extremist theocracy with public beheadings, completely abandoning our allies. Russia is wondering if this unwillingness to defend our allies extends to Europe. The troops on the border is the biggest test Biden has had in his life.

Let’s hope the President makes the right decision which leads to less conflict, which will mean he cannot give Russia a free pass on invading Ukraine in a war that would certainly last years.

The last time Russia controlled Ukraine, it was really bad, and I think Ukrainians will fight to the death to defend their land. Because, at least from what I surmise, they probably see the choices as independence, death in war, or death by famine. At least that’s what history tells us.

References

https://www.usatoday.com/story/news/politics/2022/01/20/ukrainian-president-rebukes-biden-over-russia-minor-incursion-remark/6590573001/

https://www.reuters.com/world/europe/german-chancellor-turned-down-biden-invite-discuss-ukraine-crisis-der-spiegel-2022-01-21/

https://www.economist.com/europe/what-are-russias-military-options-in-ukraine/21807240

 

Student loans are different

When you go through bankruptcy, most of your loans can be discharged. This comes at a big cost to you of course, in the form of a significantly reduced credit score, making it near impossible to borrow at a reasonable interest rate for the next 7 years, but they can be discharged and give you a blank financial slate to build yourself anew. Donald Trump knows all about this.

Mortgages, car loans, medical debt, credit cards, lines of credit, all of these can be wiped clean through bankruptcy, except for public student loans.

That’s the first big difference.

The other difference is that there really is no alternative for many Americans except for going to college. College opens the door to many of the most profitable careers you can do, plus liberal arts gives you the flexibility to be able to move to other adjacent fields because you have a general education. Nothing else can provide such flexibility in such a short amount of time.

For many Americans, the only way to gain such freedom is to take out student loans.

 

The hardest part for a mortgage is to be able to make the downpayment, and if you can’t pay off your mortgage, you can sell your house. Same with a car loan. With a credit card you can sell what you bought with your credit card. You can’t sell your education and get a large sum of money to cover your student loans in a short period of time.

Medical debt should also not be a thing, but since its private debt the solution is universal health care. A story for another time, when we have the votes in congress to deal with it.

 

Also, if one American doesn’t go to college or delays their college because they can’t get a student loan or pay for college in any other way, than the economy will pay dearly.

It’s also because like most Americans, I believe college should not be a luxury, and like most economists, I know that education is critical to the development of our economy. As more and more Americans go to college, our economy will benefit far beyond the additional cost to the Federal government. College should have no financial burden, and anyone who is willing and able to do the work should be able to go.

Student loans don’t just put college graduates in debt, it makes it impossible for many Americans to go to school at all. They widen inequality, harm economic growth, and reduce social mobility.

Student loans are a parasite on our society.

Making college affordable or free again will take congressional action. That’s unlikely to happen for a while. But the President has the power to pardon student loans up to $50,000 every single year. This will increase access to opportunity, improve our economy, and make America a better place to live.

And President Biden can do it without Joe Manchin’s permission.

Restore the social contract. Rebuild the American Dream.

Pardon student loans.