Daily Archives: February 27, 2016

James Galbraith Describes Major Forecast Failure in Model Used by Romers to Attack Friedman on Sanders Plan

Naked Capitalism has the article James Galbraith Describes Major Forecast Failure in Model Used by Romers to Attack Friedman on Sanders Plan.

So why do the Romers say so confidently that Friedman is off base? They are using a different model. And as Galbraith explains long-form, it’s one with a pretty crappy track record in post-crisis America. And Galbraith gives an important warning:

In the real world, forecasts are a very weak guide to policy; when attempting to make major changes the right strategy is to proceed and to take up the challenge of obstacles or changing circumstances as they arise. That is, after all, what Roosevelt did in the New Deal and what Lyndon Johnson did in the 1960s. Neither one could have proceeded if today’s economists had been around at that time.

This is a shocking description of the failures of the ecnomists in the Obama administration who are now throwing stones at Bernie Sanders.

One of the things about Obama that I voted for was the belief that he was a practical guy who would follow Roosevelt’s technique “proceed and to take up the challenge of obstacles or changing circumstances as they arise”

I knew that Obama had failed to meet my expectations in this regard, but until I read this article, I never realized the depths of that failure.

I think I have a special appreciation for the mathematics underpinning the wisdom of constantly checking your results, and adjusting to deviations from expectations.

My explanation below is even more abstract than the James Galbraith explanation of the problems of economic forecasting. I really don’t expect anybody to undersyand what comes below except for people who have also been in my trade of simulation of the behavior of integrated circuits.

When I first got into the business in 1969, there were severe limits on the performance of circuit simulation programs. If you tried to make too large jumps in time in your simulation, the results could predict wild oscillations in the circuits where none existed.

This was due to a method called explicit integration. In that method, you would take a few historical points in time of your simulation, and use it to predict behavior at the next point in time. You never checked to see if that prediction was continuing to satisfy the equations governing the system as a whole. To prevent the problem of oscillation, you were forced to limit yourself to time steps not larger than those limited by the smallest time constants anywhere in your circuit. This limitation would keep the errors to a reasonable level, but it really slowed down the simulator by orders of magnitude. The reason why people stuck to explicit integration was that solving the circuit equations to check for errors was an extremely compute intensive process.

In the early 1970s, The University of California at Berkeley, and others introduced ways to use implicit integration instead of explicit integration. The reason why they could use implicit integration was they had found a technique for rapidly solving the system circuit equations to see if the error was within bounds. Those rapid solving techniques are called sparse matrix techniques. With sparse matrix and implicit integration, you used the predictions from previous time points, but then you checked how accurately those predictions satisfied the equations for the circuit at the time you were trying to estimate. If the predictions were too far off, you would adjust then until they the result was acceptable. If you couldn’t find acceptable results at the new predicted time, you would try a smaller time step into the future at an earlier predicted time. This method allowed you to take much larger time steps than explicit integration allowed while not introducing wild oscillations into the results. The new method was also more suitable for simulating highly non-linear circuits like those found in computers.

In effect, you only had to worry about small time constants in parts of the circuit that were actually changing significantly. Small time constants in parts of the circuits that weren’t very active would not cause your solution to go wild.

I liken this behavior to the Roosevelt economic plan. Forecast something, do something according to your forecast, measure what happened as a result, and adjust if you see deviations from plan.

It’s not rocket science, but it is science and math. I only wish I could explain this to the lay public who are not engineers and mathematicians. Well, at least I can take comfort that I laid it all out there, even if very few will get it.

Gravitational Waves Hit The Late Show

The Morning Ticker has the story What the heck are gravitational waves? Here’s the beautiful explanation [VIDEO].

The discovery of gravitational waves has been perhaps the biggest moment in science since the discovery of the Higgs boson — but what exactly are they and what makes them so important? A physicist was on the Late Show with Stephen Colbert to break it down for everyone in America.

Here is the featured video Gravitational Waves Hit The Late Show.

I always love the analogy of the bowling ball on the trampoline and the representation of gravity bending space in the three dimensional plot superimposed on images of planets. It is such a simple concept to grasp, and the plots and explanations make you think you have learned something. Then I say to myself, a three dimensional plot has three axes. In the ones being shown, the horizontal axes represent two of the three space dimensions, and the third axis is what?

When we are talking space/time, it has four dimensions of its own. If you could conceive of a five dimensional plot, what is the 5th dimension? I did look this up on Google once and came up with some understanding of these questions, but now I have forgotten what I learned.

If you would prefer, just walk away thinking those plots have taught you something about general relativity, and be satisfied. You can nod your head knowingly whenever you see such a presentation in the future.

Bernie Sanders Demonstrates Political Revolution 1

Chris Matthews held an episode of his Hardball College Tour at which he had a “conversation” with Bernie Sanders. Just like Republicans in Congress, Matthews peppered Sanders with a bunch of questions, but hardly gave him a chance to reply. In fact Chris Matthews was giving a speech, and Bernie Sanders was merely his foil.

I have an idea for how Bernie could have taken this as an opportunity to demonstrate one way for the political revolution to gain its voice, and start to control things. I’ll start my script with the actual words of the event. Then, at the appropriate moment, I will switch to the way it could have gone.

Here is the actual dialog as best as I can transcribe it. There is a lot of one person talking over the other, which is hard to transcribe. You will have to look at the videos, yourself to get a full understanding of how overbearing Chris Matthews is.

Chris Matthews: First, next January 20th and you can walk up to the senate you could you meet with the leadership and you say I have a program here. I want up to free, I mean government-funded, tuition for public universities. There’s things I want done on Social Security to increase benefits there’s things I want done on health care so it could become like Medicare for life. You’ve got very strong positions and Mitch McConnell looks at you the way he looked at President Obama and says forget about it.

Bernie Sanders: And then you know when I say, “Hey Mitch, take a Look out the window. There are a million young people out there who don’t want to be in debt for half their life for the crime of going to college and if you want to antagonize those million people and lose your job, Mitch. If you don’t want to lose your job you better start listening to what we have to say.” That’s the point. That’s how change takes place.

CM: How do you squeeze a guy like him.

BS: It’s not him, Mitch is, I know Mitch McConnell. He’s a smart…

CM: How do you squeeze 60 senators? You need 60 senators. You need 60 Senators.

BS: Let me tell you this. Absolutely, positively 100%. If we rally young people in this country to say, “You know what? Germany, Scandinavia, other countries, they have free tuition in public colleges and universities.” I have been all over this country because I talked to kids thirty, forty, fifty, $100,000 in debt, paying a huge percentage of their income. OK, young people stand up and say we are sick and tired of it. We don’t want to go into debt for our whole lives just because we got a college education. You know what? We’ll win that fight immediately. But the trick is not to appeal to Mitch McConnell. It’s to say, “Mitch, take a look at your emails coming in …

CM: What evidence do you have you have that this has worked for you? Have you increased the turnout in these elections? Have you increased the turnout in these elections? You’ve…

BS: We’ve done, look…

CM: You know, have you as a senator have you been able to get 60 votes of senators for anything? Have you ever been able to do this? What you are talking about doing.

BS: What I am …

CN: When you say you can get 60 Senators …

BS: I am not the President of the the … What I am saying, Chris…

CN: But what evidence do you have that you can do it?

BS: What evidence do I have? The evidence that I have is the only way changes in this country that’s the only way change is about in this country. That’s what the civil rights movement was about. That’s what the women’s movement, the gay movement. That’s what it is about.

CN: It’s necessary, but is it sufficient?

BS: That’s the way …

CN: But is it sufficient to get it done? These guys run in their own states with their own conservative constituencies that will say fine Bernie Sanders a liberal President ..

BS: Let me give you an example …

CN: He’s a progressive. I am not one who will vote against him..

BS: Let me give you a good example …

CN: How do you know you can do it?

BS: How do I know? I don’t know anything. I think we do the best that we can do. We try, but

BS: You look at it inside the beltway. I am not an inside the beltway guy. I am an outside the belt way guy …

CN: But the people who vote on taxes are inside the beltway ..

BS: and those people are going to vote the right way when millions of people demand that they vote the right way. On this issue I have no doubt that as president of the United States I can rally young people and their parents to say that if Germany does it, Scandinavia does it, countries around the world do it, we can do it and yes we bailed out Wall Street …

CN: Can you [inaudible]…

BS: It is Wall Street’s time to help the middle class.

CN: The next Senate leader, Democratic leader, probably Chuck Schumer of New York. Can you deliver his vote tonight? can you tell me one Senator that is gonna follow you for these proposals? They’re all good, decent proposals. In fact they are moral proposals. Tell me the votes. Who’s going to vote with you. You say I will give you 60 votes.

BS: I know Chuck very, very well…

CN: Is he going to vote with you?

BS: Well, call him up. I don’t know. …

CN: Give us one vote? You say I will give you 60 votes and pass
it …

BS: Chris, Chris …

CN: and you can’t give me one vote.

BS: I didn’t say …

CN: One vote. Your vote, but your not going to be in the Senate anymore.

BS: I didn’t say I couldn’t give you one vote. Look what you’re not catching on. I have to say this respectfully. You are a nice guy. You are missing the point. Alright, you are missing the point. if you look at politics today is a zero sum total. If you are looking at sixty-three percent of the American people not voting, eighty percent of young people not voting, billionaires buying elections – you’re right! I’m not looking at that world. …

CN: How’s that going to change on the day you are in office? You won’t have a Supreme Court on your side.

BS: What I will have is millions of people …

CN: You are going to need 60 votes to get a Supreme Court nominee.

BS: OK, you are going around in circles.

Now here is where I would start rewriting the script.

BS: Chris, I know how to fix the problem we are having here. Let me give you a demonstration right here, on how the political revolution works.

[Bernie Sanders turns to the audience and says]

BS: Are you going to just sit there and listen to this guy try to outshout me, and cut off any ability I have to explain my plans? Or are you going to help me by shouting “Let Bernie Speak” very time Chris tries to cut me off? It is time for you to tell the powers that be that you aren’t going to take this anymore. You don’t have to be a passive audience to the travesty going on here. Let’s hear it for a two sided conversation.