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Game Theory Take On - Washington’s Rogue Elephants

nytimes.com

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Re: Game Theory Take On - Washington’s Rogue Elephants

#41

Post by lsc »

Astrohacker wrote: post #9
tomjen3 wrote: post #4

So how could he stop playing the game? Simply give up on raising the debt ceiling? That doesn't seem like it would give a good outcome.

It would be terrible in the short run, but it would be vastly better in the long run. Presently, the US is on the unsustainable trajectory of acquiring debt until it defaults. Not raising the debt ceiling would immediately end this problem. Is it better to have a smaller catastrophe now, or a bigger catastrophe later?

Eh, the thought is that revenues vary wildly with the state of the economy. If increased spending and/or tax cuts now can stimulate the economy, we'll have lots more money to pay down the debt next year, or so the theory goes.

Personally, I think it's pretty irritating that governments seems to think that the current revenue levels will continue forward no matter where we are in the business cycle. In the past, this has been most noticeable in state governments. Every time there is a boom, California goes and spends all the increased tax revenue and commits to spending it in the future. Of course, this is a problem when the economic boom ends.

I'm just suggesting that we tackle the debt problem when the economy is good. Doing so while unemployment is still 10+% is, I think, risking another downturn, which is going to make paying off the debt even harder.

Re: Game Theory Take On - Washington’s Rogue Elephants

#42

Post by ars »

albedoa wrote: post #38
ars wrote: post #28

Earlier quoted context omitted.

You are falling into the same trap. You see them wanting to shut down the goverment and decided they are insane. They have perfectly sane reasons for wanting that - you just don't agree. And if you are unable to see that, then the fault lies with you, not with them.

They have perfectly sane reasons for wanting that Name one.

Why are you asking me? Go ask them.

And whatever answer they give you, if you think that it's not a sane reason then the problem lies with you, not with them.

It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you.

Re: Game Theory Take On - Washington’s Rogue Elephants

#43

Post by albedoa »

ars wrote: post #42
albedoa wrote: post #38

Earlier quoted context omitted.

They have perfectly sane reasons for wanting that Name one.

Why are you asking me? Go ask them. And whatever answer they give you, if you think that it's not a sane reason then the problem lies with you, not with them. It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you.

I am asking you because you made the assertion.

Now you're asking me to go prove your assertions for you. I wasn't the one who made the claim.

It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you.

This is unnecessary. I do accept that other people have different opinions. What I don't accept is that they are inherently sane, which is the assertion you made. I simply asked you to support the claim that there are sane reasons with an example of such a reason.

Re: Game Theory Take On - Washington’s Rogue Elephants

#44

Post by [deleted] »

albedoa wrote: post #43
ars wrote: post #42

Earlier quoted context omitted.

Why are you asking me? Go ask them. And whatever answer they give you, if you think that it's not a sane reason then the problem lies with you, not with them. It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you.

I am asking you because you made the assertion. Now you're asking me to go prove your assertions for you. I wasn't the one who made the claim. It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you. This is unnecessary. I do accept that other people have different opinions. What I don't accept is that they are inherently…

[deleted]

Re: Game Theory Take On - Washington’s Rogue Elephants

#45

Post by jbooth »

ars wrote: post #10

Good article - up until the point where he claims the Republicans are the "rogue elephants". To the other side the Democrats are the "rogue elephants", and it's interesting that the author appears incapable of seeing that. A truly irrational person is a rare thing. If you are unable to explain the actions of your opponent in any other way then the fault lies within you, not them.

Have you paid attention to what's going on at all? Republicans are rejecting a plan that's significantly to the right of their initial demands. And they're currently pushing for a bill that reduces the deficit less than the democrats' plan, with the twist that the limit has to be reauthorized multiple times before the next election. Just to insure that congress doesn't accomplish anything and the markets are uncertain going into election 2012.

Splitting the difference is a major problem here. The Republicans are incentivized to be as crazy as possible because attitudes like yours, and most editorial boards will just split the difference assuming 2 valid points of view. So the crazier you are, the further the split will be in your direction.

Re: Game Theory Take On - Washington’s Rogue Elephants

#46

Post by nerfhammer »

Astrohacker wrote: post #35
bd_at_rivenhill wrote: post #18

Earlier quoted context omitted.

Eventually there will be a good deal of money printing involved in solving this problem, especially given the paucity of options available for fixed-income investors with a low appetite for risk (what, would you prefer the Euro or the Yen?), but it will never be the case that the US will have a solvency problem in the same way as Bear Stearns or Greece because they can always print their way out of it with inflation…

Is inflation tame according to the Fed calculations which ignore expenses that matter to people like oil, or according to meaningful calculations? Because it sure seems to me that the prices I pay are rising pretty quickly. Quickly enough that I can notice it. A cup of coffee that cost $1.95 a couple of years ago now costs $2.30. And I'm not earning any more money than I was then, so I can feel the difference.

CPI is computed by the Department of Labor. There is both a CPI and a separate "core CPI" index that attempts to exclude energy costs.

Re: Game Theory Take On - Washington’s Rogue Elephants

#47

Post by ars »

albedoa wrote: post #43
ars wrote: post #42

Earlier quoted context omitted.

Why are you asking me? Go ask them. And whatever answer they give you, if you think that it's not a sane reason then the problem lies with you, not with them. It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you.

I am asking you because you made the assertion. Now you're asking me to go prove your assertions for you. I wasn't the one who made the claim. It's hard, but eventually you will learn to accept that other people have different opinions about things - even things that seem totally obvious to you. This is unnecessary. I do accept that other people have different opinions. What I don't accept is that they are inherently…

> I do accept that other people have different opinions.

You say that and yet you can't think of even a single sane reason to want to shut down the government?

Re: Game Theory Take On - Washington’s Rogue Elephants

#48

Post by sciurus »

jbooth wrote: post #45
ars wrote: post #10

Good article - up until the point where he claims the Republicans are the "rogue elephants". To the other side the Democrats are the "rogue elephants", and it's interesting that the author appears incapable of seeing that. A truly irrational person is a rare thing. If you are unable to explain the actions of your opponent in any other way then the fault lies within you, not them.

Have you paid attention to what's going on at all? Republicans are rejecting a plan that's significantly to the right of their initial demands. And they're currently pushing for a bill that reduces the deficit less than the democrats' plan, with the twist that the limit has to be reauthorized multiple times before the next election. Just to insure that congress doesn't accomplish anything and the markets are uncertai…

For those interested, summaries and comparisons of the plans currently in the House and Senate, the positions of Obama and Boehner when negotiations broke down on the 22nd, two bipartisan senate plans, and the earlier House Republican plan are all viewable at http://www.nytimes.com/interactive/2011/07/22/us/politics/20...

Re: Game Theory Take On - Washington’s Rogue Elephants

#49

Post by erikb »

ars wrote: post #27
erikb wrote: post #13

Giving oponents a reasonable percentage of irrational behaviour is actually a normal thing in game theory. Game theory doesn't stop to apply because someone on this planet acts irrational to gain an advantage. I like to think more in terms of finding the rationale behind the "irrational behaviour". That the truthfully out of mind elephant acts this way because the cost of a failure really doesn't matter to him at tha…

That's, by definition, not irrational behavior. It would be better called "nothing to loose behavior", but of course in the real world that's pretty rare, and certainly does not apply to the politicians in the current situation.

Agreed, if they threaten something like a nuclear bombing. Let's think about another situation: At a family party there is one piece of cake left and 2 people want to eat it. Both people recognise the interest of the other one and try to offer it to the other one, but both now don't try to take it in fear of losing face. In some way you can also apply a chicken game situation here. Or another example: 2 gay men sit in a bar, see each other and consider the other one attractive. They look at each other and smile at each other. But who should make the first step? (Had to take 2 equal partners, with woman and man it is too likely that culture expects the man to act) In both situation neither the price nor the cost is that high, that relatively(!), extrem actions (like being actively impolite, or just sit there and wait in the bar until the other one makes the move) can and should be expected. I'm not into politics that much, that I could give meaningful examples there, but I think according to the situation and threats each party makes, it happens more often then you might think with just these high stakes situations in mind.

Re: Game Theory Take On - Washington’s Rogue Elephants

#50

Post by eftpotrm »

paganel wrote: post #16
Astrohacker wrote: post #9

Earlier quoted context omitted.

It would be terrible in the short run, but it would be vastly better in the long run. Presently, the US is on the unsustainable trajectory of acquiring debt until it defaults. Not raising the debt ceiling would immediately end this problem. Is it better to have a smaller catastrophe now, or a bigger catastrophe later?

> It would be terrible in the short run, but it would be vastly better in the long run. Presently, the US is on the unsustainable trajectory of acquiring debt until it defaults. Some of us have been saying this ever since Bear&Stearns went down, in the spring of 2008, that you cannot just prop up an non-solvent bank/country/whatever. At that time all the "bright" economists were saying things like "it's only a liquid…

That's a gross mischaracterisation of the situation.

The banking collapse was significantly due to a combination of over-weak market regulation causing a real estate market bubble and outright fraud at credit ratings agencies - I can think of no other term for securitising sub-prime loans into super-prime derivatives.

So, there's a major financial market crash / correction (significantly exacerbated by a very well known liquidity shortage due to institutions having to rebuild reserves and up risk factors), leading to a generalised collapse in revenues, government included.

If government is to 'live within its means' at such a time as some suggest then the spending cuts need to be utterly, utterly vicious, no way round it - cuts have to not just cover the reduction in revenues but also the increase in welfare payments, or would you rather have the suddenly poor and unemployed either starving or rioting? For the largest single player in the economy to make cuts on that scale at a time when the economy is already severely stressed, you bet the result would snowball and put the economy into an even more severe tailspin.

Which is why President Bush authorised the stimulus packages you're complaining about, which cost more on his short watch than Obama's rather longer period and yet which has still cost less than two other measures for which we should remember President Bush - top-end tax cuts and a war in Iraq over weapons that didn't exist and was pushed for after a terrorist attack by an opponent of the Iraqi regime.

All of which is on top of the limit being raised several times by Presidents Bush 1 and 2 and President Reagan, all of whom incurred significant debts. President Clinton, on the other hand, left a rising surplus which Bush took no time at all in reversing.

This whole debacle is idiotic and intellectually bankrupt pre-election grandstanding by the Republican leadership, who deserve severe electoral punishment for this absurdity.

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