When to Rob a Bank: ...And 131 More Warped Suggestions and Well-Intended Rants
Page 7
Did I say starving? Yeah, I did. Did you know that these regional crews can work for twelve to thirteen hours every day, flying five to eight legs a day, but their airline does not feel it’s important enough to provide food for them? They are already on welfare wages, and now they have to find time and money while on the ground for twenty-five minutes to simply nourish themselves. It’s a sad state of affairs. Remember, you bought the cheapest ticket.
Hurray For High Gas Prices!
(SDL)
This post was published in June 2007, when the average price of regular gasoline in the U.S. was $2.80 per gallon, having risen dramatically in previous months. A year later, the price would hit $4. As of this writing (January 2015), the price has fallen all the way to $2.06 per gallon. So even without adjusting for inflation, gas is 26 percent cheaper now than when this post was written. The federal gas tax, meanwhile, hasn’t been raised since 1993.
For a long time I have felt the price of gasoline in the United States was way too low. Pretty much all economists believe this, and also believe therefore that the gas tax should be raised substantially.
The reason we need high gas taxes is that there are all sorts of costs associated with my driving that I don’t pay—someone else pays them. This is what economists call a “negative externality.” Because I don’t pay the full costs of my driving, I drive too much. Ideally, the government could correct this problem through a gas tax that aligns my own private incentive to drive with the social costs of driving.
Three possible externalities associated with driving are the following:
a. My driving increases congestion for other drivers.
b. I might crash into other cars or pedestrians.
c. My driving contributes to global warming.
If you had to guess, which of those three considerations provides the strongest justification for a bigger tax on gasoline?
The answer, at least based on the evidence I could find, may surprise you.
The most obvious one is congestion. Traffic jams are a direct consequence of too many cars on the road. If you took some cars away, the remaining drivers could get places much faster. From Wikipedia’s page on traffic congestion:
The Texas Transportation Institute estimates that in 2000 the 75 largest metropolitan areas experienced 3.6 billion vehicle-hours of delay, resulting in 5.7 billion US gallons (21.6 billion liters) in wasted fuel and $67.5 billion in lost productivity, or about 0.7% of the nation’s GDP.
This particular study doesn’t tell us what we really need to know for estimating how big the gas tax should be. (We want to know how much adding one driver to the mix affects lost productivity.) But it does get to the point that, as a commuter, I’m better off if you decide to call in sick today.
A more subtle benefit of having fewer drivers is that there would be fewer crashes. Aaron Edlin and Pinar Mandic, in a paper I was proud to publish in the Journal of Political Economy, argue convincingly that each extra driver raises the insurance costs of other drivers by about $2,000. Their key point is that if my car is not there to crash into, maybe a crash never happens. They conclude that the appropriate tax would generate $220 billion annually. So, if they are right, reducing the number of crashes is a more important justification for a gas tax than reducing congestion. I’m not sure I believe this; it certainly is a result I never would have guessed to be true.
How about global warming? Every gallon of gas I burn releases carbon into the atmosphere, presumably speeding global warming. If you can believe Wikipedia’s entry on the carbon tax, the social cost of a ton of carbon put into the atmosphere is about forty-three dollars. (Obviously there is a huge standard of error on this number, but let’s just run with it.) If that number is right, then the gas tax needed to offset the global warming effect is about twelve cents per gallon. According to a National Academy of Sciences report, American motor vehicles burn about 160 billion gallons of gasoline and diesel each year. At twelve cents a gallon, that implies a $20 billion global warming externality. So relative to reducing congestion and lowering the number of accidents, fighting global warming is a distant third in terms of reasons to raise the gas tax. (Not that $20 billion is a small number; it just highlights how high the costs are from congestion and accidents.)
Combining all these numbers, along with the other reasons why we should raise the gas tax (e.g., wear and tear on roads), it seems easy to justify raising the gas tax by at least one dollar per gallon. In 2002 (the year I could easily find data for), the average tax was forty-two cents per gallon, or maybe only one-third of what it should be.
High gas prices act just like taxes, except that they are more transitory and the extra revenue goes to oil producers, refiners, and distributors instead of to the government.
My view is that, rather than bemoaning the high price of gas, we should be celebrating it. And, if any presidential candidate should come out in favor of a one-dollar-per-gallon tax on gas, vote for that candidate.
One hidden consequence of high gas prices: they lead to more traffic fatalities as drivers opt for smaller, fuel-efficient cars—and, increasingly, motorcycles. A 2014 study in the journal Injury Prevention found that in California alone, a thirty-cent-per-gallon rise in gas prices led to an extra eight hundred motorbike-related deaths over a nine-year period.
CHAPTER 4
Contested
©iStock.com/ChrisGorgio
Every time we write a book, our publisher prints up a bunch of swag—T-shirts, posters, etc.—to use as promotion. They send us a few boxes, which inevitably wind up in a closet. One day we were thinking: How can we give this stuff away to people who might actually want it? That’s when we decided to run our first blog contest, with the winner getting a piece of swag. These contests were so much fun—our blog readers are extraordinarily ingenious—that we held dozens of them. Here are a few of our favorites.
What Is the Most Addictive Thing in the World?
(SDL)
I was talking with my colleague and friend Gary Becker a while back about addiction. Among his many other accomplishments, for which he has won a Nobel, Becker introduced the idea of rational addiction.
When he told me his opinion as to the most addictive good, I was initially surprised and skeptical. On further reflection, I believe he is right.
So here is the quiz: What does Gary Becker think is the most addictive thing on earth?
THE FOLLOWING DAY . . .
More than six hundred readers took a shot at guessing what Gary Becker thinks is the most addictive thing on earth.
Lots of folks said things like crack and caffeine, but do you really think I’m going to offer a blog quiz with an obvious answer?
While not the answer I was looking for, there was something poetic about Deb’s guess:
A yawn. A smile. Salt.
Before I give the answer, it is worth thinking about what it means for a good to be addictive. At least the way I think about it, an addictive thing has the following characteristics:
1. Once you start consuming it, you want to consume more and more of it.
2. Over time you build up a tolerance to it; i.e., you get less enjoyment out of consuming a fixed amount of it.
3. Pursuit of that good leads you to sacrifice everything else in your life to get it, potentially leading you to do ridiculous things to try to get the good.
4. There is a period of withdrawal when you stop consuming the good.
No doubt alcohol and crack cocaine fit that description well. In Becker’s view, however, there is something even more addictive than substances: people.
When he first said this, it sounded kind of crazy to me. What does it mean to say that people are addictive?
Then I thought more about it, and I think he is right. Falling in love is the ultimate addiction. There is no question that in the early stages of attraction, spending a little bit of time with someone makes you desperately want more. Infatuation can be all-encompassing, and people will do anything to make a
relationship blossom. They will risk everything and often end up looking utterly foolish. Once someone is in a relationship, however, the utility he or she derives from time with the beloved diminishes. The heady excitement of courtship gives way to something much more mundane. Even if a relationship isn’t that good, for at least one of the parties there is a painful withdrawal period.
To get the exact answer I was looking for took until comment number 343, when Bobo responded ”Other People.” Many others were close. Jeff (comment 13) said “Society or human companionship.” Laura (comment 47) said “Love.”
I’ll declare all three of them winners.
The Unintended Consequences of a Twitter Contest
(SJD)
The other day, we woke up to realize that we were about hit our four-hundred-thousandth Twitter follower. So we put out the following tweet, offering some Freakonomics swag as a reward:
@freakonomics
We’re at 399,987 Twitter followers. Thanks everyone!
Follower #400,000 will get Freakonomics swag!
Innocent enough, no?
But we had walked right into an incentive trap.
We monitored our Twitter status in order to identify the four-hundred-thousandth follower. It happened very fast, as new followers were signing up at what seemed to be a rate of five or six per second. So we counted carefully and, voilà, found our winner:
@freakonomics
@emeganboggs You’re our 400,000th Twitter follower!
Congrats! Contest is over, thanks everyone!
But then, when we went back to our main Twitter page, we found that we were below the four-hundred-thousand mark, by quite a bit. In fact, we had fewer followers after the contest than before.
So what happened?
If you’re a Twitter pro, you’ve probably already figured it out. Our offer of swag created an incentive to unfollow and then refollow our feed. Appropriately enough, our followers informed us, and promptly:
@GuinevereXandra
@freakonomics isn’t my incentive then to unfollow and refollow and repeat until i get to 400,000?
@Schrodert
@freakonomics And the de-follows into re-follows begin!
@Keyes
@freakonomics Hah, there go twenty of your followers. Like the twitter version of those penny-a-bid auctions.
@ChaseRoper
@freakonomics you just created an incentive for followers to unfollow and try to re-follow in order to be #400K.
I wish I could say this was a clever experiment but in fact it was simply a good lesson in Twitter incentives. So the person we thought was our four-hundred-thousandth follower, @emeganboggs, wasn’t. We’ll still send her some swag, but we’ll also send some to a couple other people who actually were around the four hundred thousand mark. Even if they did unfollow us to get there :-). Thanks to everyone for a fun day on Twitter and yet another good lesson in unintended consequences.
Contest: A Six-Word Motto for the U.S.?
(SJD)
Inspired by a recent trip to London and a (New York) Times article about England’s reluctant search for a national motto (suggestions include “No Motto Please, We’re British” and “One Mighty Empire, Slightly Used”), as well as by a new book on six-word memoirs for which I wrote a piece (“On the seventh word, he rested”), I invite you all to attempt the following:
Write a six-word motto for the U.S. of A.
Foreign players are most welcome. Feel free to punctuate your motto liberally (or, if you will, conservatively); for instance: “Battered? A bit. Beaten? Puh-leeze. Onward!”
TWO WEEKS LATER . . .
Your response to our motto contest was quite strong, with more than 1,200 replies to date. Anyone looking for a good snapshot of public sentiment during this most interesting election year [2008] would do well to scroll through the comments: they are pretty damn illuminating, and not remotely sanguine.
The earliest comments tended to lean fairly hard to the left. Then, apparently because the contest was picked up on some right-leaning blogs, a long round of corrective mottoes came pouring in. Upon entering this fray, a cynic might give our motto contest the following motto:
Leftists Whine; Rightists Parry; Bedlam Accomplished
Or perhaps this:
Dead Split Between Patriots and Hatriots
Considering that this blog at least occasionally concerns itself with economics, I was surprised there weren’t more suggestions having to do with free markets, maybe something like . . .
Creative Destruction at Its Very Finest
In the end, there were so many good, thoughtful, funny, heartfelt, and nasty suggestions that it was self-evidently beyond our ability to just pick a winner. So we narrowed the entries to the following five finalists. Please vote for your choice below, and the motto with the most votes within forty-eight hours will be declared the winner.
1. The Most Gentle Empire So Far
2. You Should See the Other Guy
3. Caution! Experiment in Progress Since 1776
4. Just Like Canada, with Better Bacon
5. Our Worst Critics Prefer to Stay
A WEEK LATER . . .
As promised, we tallied your votes for a new six-word motto for the U.S. The winner was clear:
Our Worst Critics Prefer to Stay (194 votes)
Here are the runners-up:
Caution! Experiment in Progress Since 1776 (134)
The Most Gentle Empire So Far (64)
You Should See the Other Guy (38)
Just Like Canada, with Better Bacon (18)
I applaud your choice of winner, and I especially applaud “edholston,” who wrote the motto. “Our Worst Critics Prefer to Stay” is, while perhaps not outright uplifting, a wonderfully concise acknowledgment of the paradox that a capitalist democracy inevitably is: a place that is often well worth complaining about, and which allows you to complain as loudly as you wish.
It seems a small reward to get just a piece of Freakonomics swag for such a mighty task as writing a new motto for the United States, but that is all we have to offer. That, and our thanks—to Ed, and to all of you who participated.
Now, who among you can see about actually getting this motto adopted?
CHAPTER 5
How to Be Scared of the Wrong Thing
©iStock.com/CSA-Images
In SuperFreakonomics, we identified one of the most dangerous activities any person can engage in: walking drunk. Seriously. The data show that walking one mile drunk is eight times more dangerous than driving one mile drunk. But mostly people just laughed and ignored us. When it comes to evaluating risks, people stink for all sorts of reasons—from cognitive biases to the media’s emphasis on rare events. Over the years that has generated blog fodder on subjects as diverse as the fear of strangers, running out of oil, and horseback riding.
Whoa Nellie
(SJD)
Matthew Broderick recently broke his collarbone while riding a horse. This makes Broderick the fourth or fifth person I’ve heard about in recent months who was injured while riding a horse. This got me to thinking: How dangerous is horseback riding, especially compared to, say, riding a motorcycle?
A quick Google search turns up a 1990 CDC report: “Each year in the United States, an estimated 30 million persons ride horses. The rate of serious injury per number of riding hours is estimated to be higher for horseback riders than for motorcyclists and automobile racers.”
Interestingly, the people who get hurt riding horses are often under the influence of alcohol, just like the people who get hurt (and hurt others) while driving motor vehicles.
So why don’t we hear about all this horseback danger? I have a few guesses:
1. A lot of horse accidents occur on private property, and involve just one person.
2. Such accidents probably tend to not generate police reports, as a motorcycle or drag-racing accident inevitably would.
3. The kind of people who might typically call attention to uns
afe activities like horses more than they like motorcycles.
4. A big motorcycle accident is more likely to make the evening news than a horse-riding accident—unless, or course, the victim of the horse-riding accident is a Matthew Broderick or a Christopher Reeve.
I may be wrong on this, but I don’t recall that Reeve’s tragic accident was taken as a call to ban or regulate horseback riding—whereas when Ben Roethlisberger, e.g., was injured while riding his motorcycle without a helmet, all the discussion was about the foolishness of his act. I’m not saying Big Ben wasn’t being foolish; but, as a Steelers fan, I guess I’m glad he wasn’t riding a horse.
What the Secretary of Transportation Has to Say About My Car-Seat Research
(SDL)
On his official government blog, U.S. secretary of transportation Ray LaHood dismissed my research on child safety seats. This research found that car seats are no better than seat belts at reducing fatalities or serious injuries among children aged two to six; it was based on nearly thirty years’ worth of data from the U.S. Fatality Analysis Reporting System as well as from crash tests that Dubner and I commissioned.
My favorite quote from the secretary: