Thursday, August 27, 2009

Picking up your own footprints

  • We don't want to rob Peter to pay Paul.
  • We don't want to see Paul without food, clothing, shelter, and now health care apparently. (I suppose a job will be next.)
  • We especially don't want to reward laziness, recklessness, or in any way remove Paul's intrinsic responsibility to take care of his own.
On it's own, this poses quite a dilemma. Obviously we're willing to borrow enough from Peter to ensure Paul enjoys a parity of opportunity--a more than fair chance to discover a self-sustaining role in our society. This is justified as simply maximizing Paul's potential to become a productive member of society. We can even calculate the minimum amount we should be willing to invest (the loan amount that would be fairly repaid by the average person's share of GDP over their lifetime.)

Also obvious is the fact that Paul is unlikely to simply die without the basics, but will obtain them via some means that creates victims out of some of the rest of us. This seems equally irresponsible because it effectively dumps what is a problem facing all of society onto the handful of people who end up being victims (typically the most vulnerable among us.)

Even worse, it undermines our ability to do justice at all. If you force someone to steal in order to survive, and treat them as you do someone who steals out of greed, then all you've really accomplished is to tarnish the credibility of society itself. It actually forces us take the law into our own hands. (I think it might explain why people reach for a gun for protection before an exit strategy. Hostility may be a natural reaction to a needlessly unjust world. I know it makes me mad.)

While at the same time, we're looking for a way to make it harder to put a carbon dioxide molecule into the air, or to use water, energy, or any resource wastefully. We've invented some ad hoc strategies to deal with it, from tiered rates to all manner of politically charged allocation formula. But there's one strategy no one seems to mention which is odd because it seems the most obvious, most fair, and offers the most benefits.

Suppose we considered the pollution absorbing capacity of our biosphere to be something that we all owned equal shares in. If you used more than your share of any resource you would essentially be buying up someone else's share of that resource in the course of doing so. The reason to do this isn't because it elegantly solves the problem of funding the Paul's that can't cut it. The reason to do this is because it is necessary to be fair. We really do all share the air we breathe; the quality of our environment is a resource people are free to spend more than their equal share of without actually redressing the miniscule loss everyone else experiences as a consequence. This approach kills a whole flock of birds--not just the too poor and the too rich. (Another example of this is the airwaves. We are the only reason they have value; that is why we each deserve an equal share of the revenue generated by leasing them.)

A feedback mechanism is necessary to create the selective pressure--the economic opportunity--to motivate discoveries of less impactive more mutualist lifestyles, products, and social structures. It places every economic entity, from giant multi-national to the lowliest citizen (I'm sure we must have one by now) in touch with their own footprint and with a perfectly equivalent incentive to reduce it. And it does so without taking a single dollar out of the private sector--although in practice it will appear to be a tax, it honestly isn't. Every penny is returned.

Creating an income stream for everyone in the world in this way has some pretty nifty side effects. (Note that revenue generated by polluting the atmosphere in this scheme rightfully belongs to all people, not just Americans. But the revenue generated by most other things, from water to the airwaves, public lands, etc. belongs almost exclusively to Americans.) This will at least partially subsidize foreign aid (admittedly less than 1% of our budget, but every little bit helps.) It proves we're serious about being accountable for our behavior as global citizens. It earns us the respect of individuals worldwide who will immediately grasp the fairness of it and put pressure other all government to copy the policy. It even promises more tools to both document human morbidity, mortality, and rights violations data; and to prevent it.

Having a lifelong steady income stream that's inversely proportional to the impact of your lifestyle will have a vastly more dramatic effect on waste than higher prices via new taxes could. This is because there is a psychological incentive created by the awareness of where you stand with respect to average that will motivate people to beat the system by using less than their fair share and generating income from the scheme. People will not consume significantly less, just more wisely because for the first time there is a feedback loop they directly experience. The costs they cannot control today because they are collective costs to our whole society become direct costs they can and will control effortlessly. It even allows the wealthy to better enjoy their wealth knowing they are fairly redressing their huge footprint in doing so.

No other approach could be as easily or painlessly phased in. This is because the amount these shares trade at is completely arbitrary and can be very gradually adjusted to create as much or little economic pressure as we like. Some will liken it to a wealth transfer scheme--because it will indeed result in a higher level of taxes for those who consume more resources and a lower level for those who consume less. But it has nothing to do with how wealthy they might be.

I could list a lot more wonderful synergies this approach promises--from the means to make criminals fund their own incarceration, to better access for all to higher education. But this essay is already too long. And I never even got to the reason that's most important to me personally (an all too common predicament for Asperger victims:) it is an essential part of any society that wishes to allow its citizens to treat their neighbors with genuine respect.

Sunday, August 16, 2009

Religion could be our best invention

I believe religion is robbed of almost all of its utility by a single mistake made by its proponents: Their assertion that it's true. Without that mistake it is an invitation to contemplate a genuinely fair and just world. A challenge for our species, the starting point in understanding the evolution of our values—the basis of our concepts of justice, fairness, freedom, and responsibility. And a single thread linking the very spirt of our species from distant past to uncertain future.

This single mistake prevents religion from becoming a wonderful and useful tool to induce cooperation, kindness, and thoughtfulness throughout mankind. Even worse, it turns religion into it's own opposite, and history is littered with the horrible consequences that prove this. Searching for the god that we know doesn't exist is a pretty good description of what the most basic sciences are trying to do. That statement is almost flatly nonsensical, but I get the feeling from my study of science that almost all scientists are atheists, yet also can't help but have some notion of an underlying order and deep intelligence because the sheer beauty and outrageous elegance of our universe just seems to imply it. They look for beautiful and elegant theories rather than simply trying to fit the data for this reason. They aren't satisfied with today's standard model partly because it isn't as beautiful as they'd expected it to be.

Correct that single mistake and religion becomes a true and beautiful part of science. The study of human values, passions, and the search for that which is sacred by its nature (which I would argue is actually law, and only law. But that's off the point.) We need a god like we need the square root of negative one. But there is no number, either positive, zero, or negative, that when multiplied by itself gives negative one. Nonetheless, just by claiming there is such a beast, and using it, we can correctly solve a vast panoply of hard problems that could not be understood without that screwy figment of our imagination. That is real magic. The magic of imagination can have a power which is very real and tangible, and not the least bit impaired by our knowledge that it's only a metaphysical device, not a physical reality. Just because something is admittedly imaginary doesn't seem to limit it's utility—quite the contrary. Maybe you have to be imaginary to accomplish supernatural feats. Obviously nothing real could. Why can't imaginary things be useful, powerful, and worthy of knowing well? It isn't really possible to know something powerful very well without worshipping it in the most sincere sense.

Without the single mistaken claim, the shift moves from trying to know god, to trying to discover godliness. That's a crucial difference. We know what the former approach leads to. But consider how useful the search for godliness is, for it puts us in the position of having to think about creating a just and fair society. It lures us to see the consequences of our actions, evaluate the impact we have on each other, our children's future, etc. It leads us to forms of cooperation, measurement, and fairness. It forces religion into the very role it had originally intended to achieve: the most competent and genuine technology for discovering a very meaningful, fulfilling, and enjoyable lifestyle. And it gets there honestly—by making a legitimate science out of measuring a myriad of the most important things that are presently poorly or haphazardly measured, like human happiness, the quality of relationships, the environment created for children, etc.

By searching for godliness, instead of trying to better know the god of our ancestors, we're more apt to become better ourselves at noticing mutualistic solutions to problems rather than self-centered ones. Instead of teaching people that god wants them to love their neighbors, it asks us how we might engineer our society so that there is no need to ask. So that the very geometry of our economy and social structures make our utility to each other readily apparent—filled our lives with opportunities to cooperate rather than compete as it does now.

Converting religions into different approaches to a search for the mostly godly ways we can imagine would probably offend some of its adherents, but I think most would be deeply intrigued. If the utility really does come from faith, then it doesn't really matter whether god is real or not. Placebos are better than drugs if they work. A god that we know is imaginary, actually can be all of the things we assume God is. A faith that there is a means to empower every human born with the capacity to achieve a oneness of heart and spirit with the rest of humanity is worth working towards. Why not take it more seriously? Why not approach the challenge as we do everything else we're serious about accomplishing, using every tool and technique we've discovered in carefully measured and directed searching?

It really is impossible not to sin—not to have any negative impact on those around you, for example. What matters in that case is whether we'll take the steps to deal with it. If religion was a search for the economy that best redressed the intrinsic consequences of our choices, both positive and negative, then how could it lead us anywhere but towards the deepest mutualism, most symbiotic products, lifestyles, and perspectives. How could it leave us with anything but love and respect for each other, as well as for the imaginary god we realize is worth serving, and finally know why.

Wednesday, August 5, 2009

Property impairment poker

I've been trying to find ways to better illustrate an alternative approach to taxation when one popped up on television: my city is beginning another round of what appears to be a game of property impairment poker. It consists of picking the winning hand of property rights rhetoric to determine whether to issue another Conditional Use Permit. This time the unit is in a condominium complex where nearly two thirds of the units already have permits.
Like many cities in America, we broadcast our city council meetings so that residents can watch from home. Because Avalon is so small, it's easy to just walk up there and join the meeting if you see something you want to comment on. So when no one seemed to have a straightforward way to reach a decision, I decided to walk in and offer a rather rambling and fragmented summary of what I explain below.
Avalon's city council reviews each player's hand (seek-able video)

It's an interesting issue to me because it represents an opportunity to use the tax code to fairly resolve a conflict of interests between neighbors in a community. It is to everyone's benefit that all property be as useful as possible because that maximizes its value. In a resort community, like Avalon, this means a substantial fraction of residential properties are vacation homes owned by people who use them infrequently and rent them out like timeshares between those visits.

At the same time there are others who live here year round. Obviously the folks who come here to vacation are, well, on vacation. They're apt to party rather late into the night, wake up early to fish or hike, and generate a far greater disturbance than any normal use of that residence would. That's the conflict; allowing one person to use their property in a commercial way has an unavoidable consequence for nearby residents. Not letting them use it that way isn't fair either.

Our state government did what I think is the right thing to address this issue. It granted each city the power to decide whether or not any particular residential unit is suitable for this sort of commercial use and allows that use to be taxed. These two powers give a city government the means to regulate this sector of its economy.

Prior to our electronic age, it would have been too expensive to employ the people necessary to measure the impact that this policy has on our community. Each event is a tiny inconvenience for very few people, the overhead of even reporting it is in most cases more of a hassle than the event itself. But that is no longer true. Pressing a single button on your phone and going back to sleep isn't much to ask. Nor is emailing a cell phone photo of some minor vandalism, trash, or other nuisance. Especially when you know its because your city is trying to measure the impact that their policies are having on you so they can pay you back for it.

The Transient Occupancy Tax (TOT) is intended to repay the community for the additional costs it incurs from a more commercial use of its residential property. Part of doing that must include some redress of the additional cost to residents, not just their city. I can think of no other way that genuinely treats both forms of residential property rights (income generation and use as a residence) equally. Even if we assume we'll never be able to do an adequate job of resolving the conflict between residents and permit holders, this step is still necessary to avoid the exact situation we find ourselves in now--facing yet another contest with no real basis for evaluating whether a permit should be granted or refused.

If the city commits itself to using a portion of the TOT to measure and redress the actual impact the permitted units are having on residents then there is no reason why permits could not be issued by a completely automated process that didn't require anyone to judge a particular application. The map created by measuring the impact these units have will answer that question for us. It will tell us if there are any critical densities (where the impact starts to scale nonlinearly with the number of permits, peaks, or even declines.)

Keeping track of these incidents and analyzing them periodically will allow us to estimate the true cost in dollars experienced by the residents most disturbed by these units and provide for repaying them. Whenever that cost is less than what the TOT generates to repay the neighbors, a permit should be granted. And wherever it is more the city should refuse the permit, but add the application to a list of those pending, and inform the applicant that they will be issued as soon as the TOT can be raised enough to fairly compensate the community.

This approach gives the city council a fine degree of control over the sector without having to address the individual applications. The smaller the fraction of TOT they allocate to redressing its impact on residents, the fewer units will qualify for permits, the less revenue the city will receive from the TOT, and the less incentive managers have to police their clients. Conversely, allocating more to repay the residents would have an inverse effect, enabling more properties to qualify, increasing the incentive managers had to rent only to responsible clients, and increasing the revenue raised by the city.

But best of all, this mechanism allows the city to automatically monitor all such units and maintain a map anyone can view to see the data. Such a map will give the homeowners associations and managers a greater incentive to become fiercely intolerant of rowdy clients and the basis to compete with each other more vigorously because such a clear measure of their performance is visible for all to see. Finally, it will create an objective basis for revoking permits that consistently generate the highest payments to neighbors. Perhaps all such permits should come with expiration dates or need periodic extensions.

Additional Comments, Notes, and Links to related information

The impact on neighbors

It seems unreasonable to expect residents to just endure this trauma. Yet it must be what we expect because we have no mechanism to redress such minor injustices as being repeatedly disturbed at odd hours by partying vacationers. But why not? Because when it happens frequently enough it can become a significant but difficult to quantify impairment of a residence. The only remedy, not issuing a permit, is too severe as well.

This predicament effectively bars residents from any meaningful civil remedy and is the sort of needless systemic injustice that does a great deal more harm than we can notice. Until you experience a repeated inconvenience like this first hand it is difficult to appreciate how much stress, frustration, and anxiety it can add to one's life. But much worse than that is the way it undermines our expectations of and respect for justice and our community itself. It diminishes our interest in even looking for genuine solutions to other problems too because so much about our infrastructure is unjust it hardly seems worth fixing tiny parts of it. And it makes adversarial relationships between residents and owners more likely simply because we neglected to redress the civil as well as civic externalities with our TOT. This is an extremely expensive and socially dysfunctional dis-ease to accept for lack of the small amount of prevention it would take to fix it.

The bottom line is that to deny someone a permit may potentially cost the applicant thousands of dollars a year in lost income. While to grant one may potentially cost their neighbors a nuisance that has a very difficult to quantify cost that is easily undervalued. I think both of these options are simply unacceptably unfair and we must develop the means to better understand what effect this use of property has on all members of our community.

What is being done isn't enough

There is no doubt that the managers do their best to mitigate these problems by educating their clientele, posting rules, inviting complaints, and issuing 24 hour response numbers to residents. They live here too, and the sort of clients that are rowdy do more damage than they're worth in revenue, so they have similar interests in avoiding these problems. But none of these things compensate the folks for being repeatedly disturbed. Instead, those nearby residents are effectively drafted into doing surveillance service for the managers; forced to notify the managers when unruly clients break their rules if they want anything done about it. This is unreasonable to ask of someone in a residential neighborhood or housing unit--mainly because our local government could fix the problem with something like the mechanism I'm proposing.

Suppose a thoughtful management company wanted to simply share a small fraction of the rental income from each unit with the neighbors as an acknowledgement of the impact and a sort of payment for their unavoidable role in helping to police them. I'm guessing a lot of us, and perhaps some of the the city council, would actually misinterpret that as a bribe. Or at least be deeply skeptical of their motives. It would most likely seem wasteful to their property owners and disadvantage that management company in competing for properties to manage. It is really only our local government itself that can mitigate the inevitable impairment the various properties experience as a consequence of its policies. Forcing the handful of residents most inconvenienced by this to suffer so that all of us can enjoy a larger economy is exactly the kind of thing our government is supposed to prevent. A just society would either fix or abolish it.

Our goal is a parity of opportunity

Suppose the city set aside a tiny portion of the Transient Occupancy Taxes collected to create both a more compelling incentive for managers to avoid the complaints, and a resource that can pay residents for the damages incurred. All the city needs is a data gathering answering machine or web site to log the complaints. At the end of each year the city council could review a summary of the events recorded that year and come up with fees for each type of incident that would redirect some portion of the refund due managers to those injured neighbors.

The whole purpose of the TOT is to redress the extra costs the commercial use of residential property imposes on the city, but it does nothing to redress similar costs faced by the nearby residents. The very purpose of government is to protect our rights. The means to do so is available and the consequences of not doing so seem very significant:
  • an unavoidable nuisance befalls a very few members of our community
  • a great deal of our city council and staff's time is consumed to evaluate each application
  • a capricious, complicated, and expensive process awaits property owners seeking permits.
By setting aside a small portion of the TOT revenue to use as I describe, the city ensures it will collect the data needed to craft sensible and mechanical guidelines for evaluating permit requests. It gives the city a measure of the impact of different concentrations of transient housing, permits a more objective evaluation of the performance of management firms, and generates a map of the units most affected. These are the tools needed to craft a fair and objective mechanism to resolve these conflicts in property rights.

I'll bet the size of the cheque that affected residents end up receiving isn't as important as the knowledge that our city is tracking their complaints. Even if it was only a letter summarizing the impact on that resident and how it compares to the average it would go a long way towards making them feel heard, acknowledged, and offer hope that a fairer solution is in the works.

We should have a strategy that promises to get continuously better at mitigating the impact over the long term. We must convince residents that we are seriously committed to engineering solutions that protect all of our rights as efficiently and effectively as possible. Over a ten year period, I believe this approach will lead us to a permanent, simple, and extremely fair infrastructure for everyone involved. I'm only 54. But I've already noticed that people make a lot more progress when they cooperate rather than compete. Wise leadership finds a way to get everyone on the same team fighting the same enemy--in this case its the injustice. I believe this approach better aligns the interests of both the residents and managers.

Are there any reasonable objections?

In a discussion of this issue with someone after the meeting, he made the point that someone would have no recourse in dealing with a neighbor who's young children create a similar noise problem much more frequently. (I should note that his kids can scream at a pitch and volume that would easily drown out a smoke detector.) I don't regard this as a reasonable challenge for a number of reasons. Most notably that the TOT exposure is in addition to the normal noise of living in a small community of very densely packed housing.

But that example seems particularly inappropriate because children represent a tremendous positive externality as well--they are our future and, whether we realize, acknowledge, or even resent it--we are all part of their education. Thus we have a completely natural obligation to all children as a consequence of being adult human beings and that includes dealing patiently with issues like the noise they make. Even in the case of a recklessly inconsiderate adult neighbor, the common challenge we all face as members of a community to find ways to get along well with our neighbors seems incomparable to the uncommon burden of being forced to simply accept the consequences of the commercialization of adjacent housing.

His other objection was that it would encourage people to complain just for the compensation, and over issues they would otherwise not have considered a nuisance. I suspect this is true to some extent but would both fall off rapidly with time, and tend to reveal the unreasonable residents rather than become an intractable problem. (The city could discourage them by adopting a policy that penalized false reports by withholding the funds that person would have earned for their legitimate complaints.) I think there are also many people who don't bother to complain now because they don't like being nuisances themselves, and it doesn't really help--the noise generated by a security response might even extend the duration of a disturbance, and will almost certainly anger the visitors being interrupted and increase the potential for vandalism. A phone number where residents could leave a message (or send an email, text, or photo from a phone) without having to notify the managements security would give the city a much better idea of exactly how much impact the transient rentals are having on residents, as well as the tools needed to effectively redress that impact.

Related Information