Caplans of the Caribbean

I just returned from cruising the Caribbean on Anthem of the SeasMaybe you’ve heard of it? Fortunately, no coronavirus panic marred our vacation, and the concluding scare at the dock turned out to be a false alarm.  Though I’d seen a little of the Caribbean before, this trip was a heavy dose: after a stop at San Juan, Puerto Rico, we sailed on to St. Maarten, Antigua, St. Lucia, and St. Kitts.  My social science reflections:

1. I’ve been writing about Puerto Rico for years.  Its great open borders experiment doesn’t just put an upper bound on the dangers of “brain drain”; it also shows that liberalization makes migration serenely “snowball” rather than frighteningly “flood.” I was excited, then, to finally see Puerto Rico with my own eyes.  San Juan, at least, met my high expectations.  It’s a rich and beautiful city – and I didn’t merely visit the tourist areas.  The country is packed with Walmarts and other big-box retail.  Uber works well.  I saw near-zero remnants of Hurricane Maria, and – through my bilingual sons – had two fun chats with jovial Uber drivers.  Next time, I’d really like to drive the Ruta Panorámica.  No doubt I’d witness some serious poverty, but I doubt it’s more disturbing than driving around rural Mississippi or West Virginia.

When I invoke Puerto Rico, immigration skeptics often scoff.  Hurricane Maria aside, they deem Puerto Rico a disaster zone.  After all, if it were a U.S. state, Puerto Rico (with a per-capita GDP of just $32,000) would be even poorer than Mississippi, right?

I call this a willfully misanthropic comparison.  To grasp the effects of open borders on Puerto Rico, you have to ask, “How would Puerto Ricans be doing if they didn’t enjoy free migration to the U.S.?”  To answer that question, you’ve got to look not as Mississippi, but at other Caribbean islands.  Which I then proceeded to do.

2. Our next stop was St. Maarten (the Dutch side).  Official estimates of its per-capita GDP vary very widely.  While the CIA absurdly sets it at $66,800 (PPP), Wikipedia provides only a 2008 estimate of $15,400 (nominal).  Compared to Puerto Rico, in any case, the island looks quite poor.  A good chunk of this admittedly stems from low population; 42,000 people plus tourists aren’t enough to sustain more than a few restaurants or entertainment venues.  Even taking population into account, however, living standards look low.  Desperate peddling of tourist wares is a common job.  Roads are bumpy.  The shiniest business we saw was a KFC.  The biggest grocery store we found wasn’t bad, but about a third of the refrigerated shelves were empty.  There’s no Uber, but since there are plenty of taxis, I blame regulation.  After SNUBA diving (awesome), we taxied to the local tropical zoo, which sadly turned out to be shuttered since Maria.

What explains the gap between the official economic statistics and what we saw?  The simplest story is that a few super-rich expats drive up the average, but it’s hard to believe that’s close to the whole story.  The next explanation is that I’m such a spoiled American that almost everywhere on Earth looks impoverished to me.  Another is that the statistics are fake; but wouldn’t countries want to overstate their poverty to get extra foreign aid?  Last, CPI bias is plausibly astronomically unfavorable in small islands where there’s not much to spend your money on.  (As I told Tyler, there are odd parallels between small Swiss towns and these Caribbean islands; in both places, even the rich have little to buy).

While we’re on the subject of CPI bias, the Internet has clearly been a nearly unmeasured godsend for the whole region.  In 1990, islanders would have been cut off from 99% of humanity’s cultural bounty.  Today, the curious can sample and savor this bounty for modest connection fees.

3. Then we sailed on to Antigua (a subset of Antigua and Barbuda), with recent per capita GDP estimates of $17,500 nominal and $28,000 PPP.  It did indeed look a little richer than St. Maarten, though that too could be confounded with higher population.  The downtown was fun to see, but the roads were bumpy and even the main sidewalks poorly maintained.  While shuttling to snorkeling, we saw a huge sports stadium (10,000 seats!) largely funded by the government of mainland China.  (Other islands, in contrast, seemed oriented toward Taiwan).  There were fewer desperate peddlers, but almost no businesses even in the historic downtown.  As Richard Scarry famously inquired, “What do people do all day?”

4. Next, we saw St. Lucia.  Geographically, it was the most beautiful of the islands.  The Pitons are splendid, and we passed some scenic harbors and resorts.  Economically, though, St. Lucia looked the worst.  This fits with official statistics, which put its per-capita GDP at $10,000 nominal and $15,000 PPP.  Even though it has roughly twice the population of Antigua and Barbuda, the KFC was again the shiniest business we saw.  The main downtown church was closed, and the nearby park contained about a dozen apparently homeless men, though perhaps they were just relaxing and drinking alone.  Desperate peddling was intense.  The local police seemed to be one of the main employers.

5. Our last stop was on St. Kitts (a subset of St. Kitts and Nevis), whose per capital GDP of $19,000 nominal and $31,000 PPP make it the richest island we saw after Puerto Rico.  Since we spent six hours hiking Mount Liamuiga, the local volcano, we never walked the town.  Yet we did get to see a long stretch of one of the main coastal highways, and the country did indeed look marginally richer than Antigua.

My hiking guide described himself as “fascinated by economics,” and we had a good amount of time to chat.  He suffered from severe pessimistic bias; I tried in vain to calm his fears that U.S. agro-business faced imminent crisis.  When he playfully accused me of having naive faith in mankind, I told him, “No, I just believe in business.”  He mentioned his Netflix subscription, but I didn’t have time to rhetorically build on that foundation.

My guide knew a handful of islanders who worked in the UK, but viewed his countrymen as deeply provincial.  Cruise ships dock all the time in St. Kitts, but when I asked him if he knew anyone who worked on such a ship, he insisted, “It’s not something they would ever think about as a possibility.”  This surprised me, because workers of Caribbean origin were fairly common on my ship, especially relative to their countries’ populations.

6. Are the latter four islands the ideal comparison group for Puerto Rico?  Not really.  Antigua, St. Lucia, and St. Kitts are all former British colonies, and St. Maarten’s is so anglophone that it might as well be.  A better approach is to compare Puerto Rico with other former Spanish colonies; the Dominican Republic is the most obvious counterpart.  Since the latter’s per-capita GDP is only $9000, Puerto Rico’s open borders experiment look even better.

7. I’ve repeatedly heard people claim that open borders would turn the U.S. into Haiti.  On this journey, I was struck by the fact that almost nowhere in the Caribbean is remotely as awful as Haiti.  St. Maarten, Antigua, St. Lucia, and St. Kitts all have roughly the same demographics has Haiti – all are 90%+ black.   They all have roughly the same history of hellish slave plantations.  Furthermore, according to the least-bad estimates, their national average IQs are all extremely low.  St. Lucia comes in second-to-last on Earth, with an average national IQ of 62 (versus Haiti’s 67).  Despite these parallels, St. Lucia roughly matches average global per-capita income, and St. Maarten, Antigua, and and St. Kitts are comfortably above this average.

8. With the able assistance of Nathaniel Bechhofer, I’ve pointed out that “Deep Roots” theories of national development are highly sensitive to population-weighting.  If you count China and India as two data points, the empirics say that national ancestry matters a lot.  When you weigh countries by their populations, however, national ancestry barely matters at all, because the two most-populous countries on Earth have done poorly in modern times despite their illustrious histories.  Critics have pushed back; each country should count as a separate “experiment,” so we should base our worldviews on the unweighted results.

Yet in that case, each and every tiny upper-middle-income Caribbean country should statistically count as much as China and India.  I just checked Putterman and Weil‘s data, and found that none of my last four islands is actually in their sample.  (Haiti and Jamaica are, but even the Bahamas fell through the cracks).  If we re-did Deep Roots estimates with ten more Caribbean data points, I predict that their results would markedly attenuate.  So would Garett’s main findings in Hive Mind.

Personally, I continue to think that population-weighting is the way to go in cross-country regressions.  If you disagree, though, you’d really better add the island nations of the Caribbean to your sample and watch what happens.

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When Did We Become Socialists?

Nobody asked but …

What state has reached the highest level of socialism?  It happened when:

… and so it goes.

— Kilgore Forelle

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Yale Study: Vast Majority of High Schoolers Unhappy at School

Most high school students are not happy at school. A new study by Yale researchers finds that nearly three-quarters of high schoolers report negative feelings toward school. The study surveyed more than 20,000 high school students in all 50 US states and found widespread dissatisfaction at school across all demographic groups, with girls reporting slightly more negative emotions than boys. According to Yale co-author Zorana Ivcevic,

It was higher than we expected. We know from talking to students that they are feeling tired, stressed, and bored, but were surprised by how overwhelming it was.

The Yale findings, which were published in the most recent edition of the academic journal Learning and Instruction, echo previous conclusions about young people’s attitudes toward school. According to a 2016 Gallup student poll of nearly one million children from approximately three thousand different schools, enthusiasm for school dropped dramatically between fifth grade and twelfth grade.

In another large-scale 2003 study, psychologists tracked several hundred elementary and secondary school students over the course of a week. The students wore watches that signaled them several times a day to record, at that moment, what the students were doing and how they were feeling. The results revealed that children were unhappiest while they were at school, and happiest when out of school.

Is There a Better Way?

Perhaps these results are not surprising. School isn’t supposed to be fun, right? Kids have to deal with the drudgery of school, buckle down, and do the work because that’s life. Or so the thinking goes. What a horrible message to send to children, and to internalize ourselves: Life is drudgery, work is drudgery, and the sooner people learn this in school, the better off they will be.

It doesn’t have to be this way. For young people who are educated outside of forced schooling environments, learning can be engaging, rewarding, and yes, fun. Free to pursue passions, explore talents, and set individual goals, young people who learn without schooling or who are educated in other non-coercive learning environments, retain and expand their curiosity and autonomy.

It’s the lack of freedom and personal agency that leads to negative emotions toward school or life. When individuals are empowered to take charge of their living and learning, negativity diminishes.

Parents should take seriously these negative emotions in their adolescents, particularly as youth anxiety, depression, and suicide continue to soar. Researchers at Vanderbilt University found a correlation between adolescent suicidal thoughts and actions and school attendance, reporting that these tendencies decline during the summer months and spike at back-to-school time. This is an opposite pattern to that of adults, who experience the highest rates of suicide during the summertime.

In sharing the results of their latest survey on high schoolers’ negative feelings toward school, the Yale researchers suggest that later school start times might help by allowing young people more time for sleep; but this merely puts a Band-Aid on a much deeper wound. Teenagers don’t like school because their freedom is tightly controlled, they are micro-managed by adults, and they have no or little input in what, how, where, or with whom they learn. On the brink of adulthood, teenagers are increasingly treated like toddlers.

Not only is it dangerous to dismiss adolescents’ antipathy toward school as normal and expected, it avoids an honest look at the impact of coercion on human flourishing. When people are free, they thrive; with force, they flounder.

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We Don’t Recognize the World’s Justice

“. . . the arc of the moral universe is long, but it bends toward justice.”

If you don’t think that evil is punished and good is rewarded, I get it.

A fair number of corrupt people seem to enjoy wealth, status, and even long lives. Lots of war criminals and ordinary criminals get away with it. Few direct restitutions happen anymore.

But justice is still working.

Depression, unease, fights that happen behind closed doors, the breakdown of physical or mental health, constant distrust and paranoia- these are reality’s punishments for attempts to defraud it. People pursuing evil may appear to be fine physically, but they will suffer mentally.

Similarly, those who do right may not see outsized positive physical impacts (they will usually see some). They may receive the bulk of their just desserts in the form of stabler relationships, better sleep at night, and a general trust that people are good (or at least not out to get them). These benefits may be small, but they add up over time.

Justice is inexorable because the mind is inescapable. Don’t let it’s invisibility discourage you.

Originally published at JamesWalpole.com.

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State of the Union: No, Nick, Your Children Owe Nothing

Nicholas Sarwark is father to four pre-teen children. In his response to the State of the Union, delivered on behalf of the Libertarian Party (which he serves as national chair), he mentions that each of them are in debt to the tune of $70,633. “Not because we gave them credit cards to go buy cars,” he explains, but “because politicians in Washington have a credit card called the national debt.”

I don’t disagree with Nick — whom I’ve known for about 20 years — very often. On this subject, however, I do so vehemently.

No, Nick, your children don’t owe $70,633 each to the US government’s creditors. Nor do you or your wife Valerie. Nor do I. Nor does anyone reading this column who’s not a current or former president, vice-president, or member of Congress.

The only people who owe the $23 trillion “national debt” are the people who borrowed the money.

You didn’t borrow the money. They did.

You didn’t co-sign the loan. You didn’t negotiate the interest rates or other terms.

Yes, they offered your future income and your children’s future income as collateral, but that income wasn’t theirs to offer. You weren’t even consulted, except to the extent that 25% or so of you (on average) voted for one or more of the borrowers, most of whom lied to you about exercising “fiscal discipline” if elected.

And their creditors knew that, making them loan sharks by proxy. How else to describe someone who loans money on the borrowers’ promise to go beat it — principal plus interest — out of non-consenting third parties?

No one in his or her right mind believes the “national debt” will ever be paid off. It’s too big, it’s growing too fast, and it represents too large a chunk of American wealth and production.

Sooner or later, in one way or another, the US government will default. The politicians who borrow the money and the speculators who loan it to them are both engaged in a long-term game of musical chairs, hoping that the music won’t stop before they retire, die, or cash out at a profit.

When the music does stop, it’s going to get ugly for all of us. But the longer the music continues, the uglier that final note.

The good news is that after the default, the politicians’ credit card will be declined for some time to come, perhaps teaching them to live within their ample means.

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Elon Musk Wants Talent, Not Diplomas

Elon Musk says skills matter more than diplomas. The founder and CEO of corporate innovation giants Tesla and SpaceX tweeted on February 2 that he is hiring for his artificial intelligence group at Tesla and wants to recruit the most talented people he can find. Talent, to Musk, means “deep understanding” of artificial intelligence and the ability to >pass a “hardcore coding test,” but it doesn’t necessarily include degrees and diplomas.

“A PhD is definitely not required,” Musk wrote. “I don’t care if you even graduated high school.”

Musk went on to say on Sunday that “educational background is irrelevant”:

Musk Didn’t Like School

It’s not surprising that Musk would emphasize ability and knowledge over institutional credentials. Other Silicon Valley technology companies, like Google and Apple, no longer require employees to have a college degree. But Musk also had a personal dissatisfaction with his schooling, saying in a 2015 interview: “I hated going to school when I was a kid. It was torture.”

A billionaire inventor, Musk decided to build a better educational program for his own children and opened his experimental school, Ad Astra, on SpaceX’s Los Angeles campus. He was dissatisfied with the elite private schools they were attending and thought education, even at purportedly “good” schools, could be much improved.

In an interview about Ad Astra, Musk said: “The regular schools weren’t doing the things that I thought should be done. So I thought, well, let’s see what we can do.”

Ad Astra, which means “to the stars,” offers a hands-on, passion-driven learning environment that defies the coercion inherent in most conventional schooling, public or private. It has no grade levels, an emergent, technology-focused curriculum, and no mandatory classes. As Fortune reports, “There are no grades given to students at the school and if the children don’t like a particular class they’re taking, they can simply opt out.”

Schooling as Signaling

Despite a culture and economy now focused around technology and innovation, most conventional schooling is widely incapable of helping young people develop the knowledge and skills they need to do essential 21st-century work. Stuck in a 19th-century curriculum and instruction model, today’s schools are anything but modern.

The trouble is that schooling is more about signaling than learning, so the catalysts to change its basic structure and approach are lacking. It might not matter in the real world that you mastered middle school French, but moving successfully along the schooling conveyor belt offers a signal to potential employers. Economist Bryan Caplan writes about this signaling effect in his book The Case Against Education. He also explains how the quest for more signals, regardless of how hollow they may be, is leading to “credential inflation,” or the pursuit of more diplomas for occupations that really don’t require them.

Writing in The Atlantic, Caplan says:

From kindergarten on, students spend thousands of hours studying subjects irrelevant to the modern labor market. Why do English classes focus on literature and poetry instead of business and technical writing? Why do advanced-math classes bother with proofs almost no student can follow? When will the typical student use history? Trigonometry? Art? Music? Physics? Latin? The class clown who snarks “What does this have to do with real life?” is onto something.

More Signal Options Beyond Schooling

Fortunately, there are now many other ways beyond conventional schooling to gain skills and knowledge and signal your value to potential employers like Musk. More than 400 “coding bootcamps” are reported to exist around the world, helping people to master in-demand programming and software development skills. The online coding school, Lambda School, which has raised nearly $50 million in venture capital funding since its launch in 2017, has a fascinating business model focused on income share agreements. It is free to attend Lambda, but the company takes a percentage of its graduates’ earnings once they land a high-tech job. If the student doesn’t land a job, she doesn’t pay. Perhaps not surprisingly, it is estimated that Lambda is receiving over 1,000 applications a week from interested students. Other alternatives to college are sprouting, and apprenticeship programs like Praxis continue to be sought-after.

Entrepreneurs like Musk recognize what it takes to succeed in the innovation era, and it has little to do with conventional schooling. Discovering passions, pursuing personal goals, and developing essential skills to build on those passions and achieve those goals has never been easier than it is today with abundant resources and tools literally at our fingertips.

Musk and Tesla may be known for their visionary work in creating autonomous vehicles, but it’s autonomous humans with the agency, creativity, and opportunity to achieve their full potential that are the real breakthroughs.

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