Friday, February 21, 2003

Skills and economics

Mark Kleiman has an interesting post on America's lousy record in training for high skills jobs. The problem is straightforward - employers have little incentive to invest in training low skill workers because these workers tend to move from job to job, taking their (expensively acquired) skills with them. Thus, there's a collective action problem. Even if a skilled workforce is in the interests of all employers, each individual employer has an incentive to underinvest in skills training, because she doesn't capture all the benefits of improving workers' skills. Kleiman argues that in a world where we don't have guild apprenticeships, indentured servitude or slavery, the obvious way to fix this problem is through financial incentives; give employers a chunk of low-skilled workers' future social security contributions, which would allow these employers to recapture some of the investment that they had made in training. It's an interesting proposal, but there are other ways to tackle this problem, which have a stronger track record - they've been shown to work in practice.

First - you can oblige employers to contribute collectively to skills and training, through industry level associations that work in cahoots with the state. This works pretty well in Germany, as Wolfgang Streeck has shown in a series of publications. Firms sometimes need to be compelled to do what is in their collective interest, precisely because it is their collective, rather than individual interest which is at stake (this is the basic point of the collective action literature). Second - you can institute a strong welfare state. This doesn't affect the incentives of firms so much as the incentives of individuals. Individuals are more prepared to invest heavily in job and industry specific skills, because they are less worried about what is likely to happen if their firm fires them, or their industry goes into recession. As Torben Iversen and his colleagues show, there is strong empirical evidence that specific skill training goes hand in hand with strong welfare systems. The rub, however, as Iversen et al. point out, is that economies which favour generalist training (such as broadly focused university degrees) do some things better than economies with strong vocational training. The former tend to adapt better to rapidly changing economic circumstances, and to produce more in the way of radical innovation, while the latter take better advantage of stable economic conditions, and provide better incremental innovation.

Update William Sjostrom comments on Kleiman's post (as an economist, he's naturally sympathetic to the idea of market incentives, if uncertain about whether the incentives will actually do what they're supposed to).

Thursday, February 20, 2003

Put it this way; I wouldn't like to be Christopher Hitchens' granny

D-squared is on a roll again. Go look.
Paxman, My Hero

I won't have a word said against Jeremy Paxman. Apart from the fact that he embodies some of the best British qualities of his type- equal measures of erudition and disinterest - I actually quite fancy him. For years I have fantasised about being one of the hapless students he questions on University Challenge. Paxman doesn't 'host' the quiz show that taught me all I know about the relative merits and status of British universities, he chairs it. He is like the college tutor you worked the hardest for - the one who is genuinely appalled at your lapses in knowledge and understanding, and has cultivated the driest wit to expose them. And I'm not the only addled blue-stocking who laps it up.

I don't think he sneers. Though, as Henry says, a certain amount of healthy disdain is a very good thing when interviewing politicians. Here's what Jez has to say about the sneering jibe;

"I hate the word sneering. I can't help how my face looks. One has to bear in mind that people have voted for even the most humble backbencher. No one has ever voted for me. So sneering is not something I'm happy or comfortable about when people use it to describe me. Incredulity, scepticism maybe. But sneering I don't like."

Paxman is an institution. He has been asking the tough questions for years and there is no better man anywhere to circumvent the glossy PR training of modern politicians and cut right to the heart of things. No one who saw that edition of Newsnight in 1998 will ever forget his asking the unfortunate Michael Howard the same question over and over about sacking the head of the prison service. It is one of the best moments ever on television. And that includes Ali G's interview of Posh and Becks. Paxman himself said he'd only asked the same question 14 times because he'd actually forgotten the next question and had to fill in time. Genius.

Of course, sometimes Paxman can go too far, but he is certainly an equal opportunity bruiser.

Here is my favourite example of Paxman in stunning form, interrogating Tony Blair just before the last election, and neatly exposing the contradictions at the heart of the government's programme.

Andrew Sullivan's comment that "Paxman is a notoriously rude and offensive interviewer in what is a ruder and more offensive political-media culture in Britain" exposes a big difference between the UK and US in how politicians are treated and how they are expected to act. For example, although he's tried to wriggle out of it, Tony Blair still has to face Prime Minister's Questions every Wednesday morning in the House of Commons. This involves him facing, less than 10 feet away, a generally very hostile opposition, who hurl tricky questions and barbed comments throughout, and frequently laugh or shout him down. It can't be very pleasant for him, but the reason the British Prime Minister strides regularly into the lion's den is that he is directly answerable to Parliament. This is completely different from the US where minders and sound bites are much more the order of the day. Of course politicians don't always like this - one of the key criticisms of Blair is that he's tried to be a 'presidential' Prime Minister - but they are well able for it. Don't forget, Tony Blair, Jeremy Paxman et al would all have earned their stripes before they were 20 in the bruising surround of student debating and journalism at Oxford. I've seen the debating styles in both the Oxford Union and the House of Commons and (though this may not be entirely a good thing!), the tactics and even some of the punchlines of this much-loved bloodsport are pretty much the same in both.

There is a tradition of accountability in UK politics which no amount of New Labour spin or Tory slithering has been able to eradicate. It's true that no PM has exposed him or herself to live, direct and unfiltered public questioning since Margaret Thatcher was infamously nobbled about the sinking of the Belgrano during the Falklands conflict. But none of them is considered above the gritty wear and tear of public accountability. It's bloody and it's bruising, but it's very democratic.

Wednesday, February 19, 2003

further plug

Proofs for my forthcoming article in International Organization on the international regulation of privacy arrived today; anyone who's interested can read the piece here (although 1-2 sentences are still a little garbled). IO is the big journal in the field of international relations, which means good things for my tenure chances, so I'm feeling a little smug.

Further update - via Electrolite, Timothy Burke's blog, which has a nice attached essay on why journals suck in '03.
Big Brother and the Holding Company II

The punchline is that telcos broke the law throughout the 1990's by retaining individuals' communications data long after they were legally required to delete it. European data protection legislation (Directive 95/46/EC for companies generally, and 97/66 which applied data protection to the communications networks) requires companies to delete personal information no longer required for legitimate business purposes - for example, after the period you can question your phone bill has passed. The great unspoken weakness in business opposition to mandatory traffic data retention today is that many companies have been retaining the information illegally for years.

Early last year, Eircom, the Irish former incumbent telco, was discovered to have been keeping individuals phone data for years at a time, with no stated plans to either use it or delete it. Mobile phone companies in the UK have also retained communications data, including the location data of mobile users, for periods far in excess of what is legal. This law-breaking has gone unpunished, unless you count the occasional yelps of outrage from the Data Protection Authorities. The illegal retention of individuals' communications data suited the companies who dreamed of one day having enough processing power to crunch through the data and use it for marketing purposes. It suited law enforcement authorities (LEAs) and therefore justice / interior ministries for whom the data was available for specific investigations and fishing expeditions, notwithstanding its illegality. And it was a linchpin of the unholy alliance between the bigger telcos and LEAs which is based on telcos' willingness to co-operate with LEAs in return for greater consultation and all the privileges that come from being invited to the table.

Now, of course, the new version of 97/66, called 2002/58/EC, has removed the protections against widescale retention of individuals' traffic data, effectively making objections to illegal retention moot. This Directive was passed just before last summer and got rid of basic human rights protections is thanks to the spinelessness of the European Parliament. There's some window-dressing language in the revised Directive which kindly asks that national legislators keep in mind Article 8 of the European Convention on Human Rights, but this is a toothless gesture. If the parliamentarians had had any respect for Article 8 in the first place, they'd never have bowed to pressure from the Council of Justice Ministers and the Commission to cut out the only remaining protection for European citizens against mass surveillance.

So, where do we stand now?

With a revised Directive which is ambiguous at best, and almost certainly worthless in putting any real limits on states' intentions to impose mandatory communications data retention.

With a Council of Justice Ministers which has been very quiet since before Christmas, but is likely preparing a draft Framework Decision on data retention in all EU member states (and of course accession countries will swiftly follow).

However, there is scope to do damage control. Everyone who opposes data retention should take advantage of the current EU lull on this issue to focus efforts and attention on the viable alternative to widescale retention; data preservation. Data preservation simply means that the police / intelligence agencies / etc. approach the telcos and ISPs early in an investigation and on a case by case basis for the information they need, requesting that the data be frozen or 'preserved' until the correct legal instrument (i.e. production order) is gotten. Preservation needs to be done with proper oversight and procedures, but it has the massive benefit of not penalising the entire population for the misdoings of the tiny few. So far, not a single law enforcement authority has made a compelling case for why data preservation is suddenly insufficient for their needs. The Council of Europe Convention on cybercrime, however dodgy its politics (and yes, they were exclusive, behind closed doors, and very, very dodgy), only stumps for data preservation, not retention. If it's good enough for them...

People who oppose widescale mandatory retention must work to flesh out data preservation and show how it is a viable alternative to retention. It is time campaigners put law enforcement on the back foot, rather than having to react to proposals, each more egregious than the last.

Tuesday, February 18, 2003

Big Brother and the Holding Company

Via Patrick Nielsen Hayden, this LawMeme discussion of how readily Ebay shares customer information with law enforcement agencies (or those purporting to represent them). It used to be, back in the 1970's, that privacy activists were upset because of Big Government Databases. Then, when the e-commerce boom started, people got worried about firms monitoring their websurfing, and tarting the info to the highest bidder. Now, we seem to be entering the worst of both worlds - firms gathering information on your online behavior, storing it, and passing it on to the authorities without so much as a wiretapping warrant. And things are only going to get worse - the shifty politics behind the Council of Europe's Convention on Cybercrime, and EU policies on ISP mandatory data retention give some idea of what's ahead. I've just finished a piece on all of this for a SSRC project (tho' be warned that it's written in worthy and slightly turgid academese).

Further plug: Maria and I will be organizing a plenary session on this at the annual Computers, Freedom and Privacy conference in New York this year.
Baghdad Broadcasting Corporation

Andrew Sullivan has it all figured out; BBC brainwashing is responsible for the massive anti-war turnout in London. Evidence for this inane theory: biased current affairs shows, rudeness to Prime Ministers and other heinous crimes against humanity. There are several possible responses to this. First is the analytic. As Kieran Healy said a while back, there's something fishy and inconsistent going on when libertarians resort to arguing that mass publics consist of pathetic, manipulated dupes. Second is the obvious. Andrew Sullivan doesn't seem to have any problems with bias at Fox; one can only presume that O'Reilly, Hannity and friends are paragons of disinterested public journalism.

But perhaps the best response of all is the simplest: Sullivan's claims just aren't convincing. Take a look at Rome - 2 million demonstrators and no "Baghdad Broadcasting Corporation" to program their tiny little minds. Silvio Berlusconi supports the US, owns Italian private TV, and has stacked public broadcasting with his cronies, but protesters still turn out in their multitudes. Sullivan and his warblogging comperes can bluster about the BBC and the stupidity of the protesters to their hearts' content; they presumably get some entertainment from it. Still, it ducks the key question; if the case for war is so convincing, why aren't most people outside the US convinced? Why does a majority of the public in Britain, let alone France, find the arguments of a mendacious old fraud like Jacques Chirac more compelling than those of Tony Blair? There's something happening here that right-bloggers need to take more seriously.

PS - Sullivan quotes a reader who's upset that 'some reporter from the BBC named "Jeremy"' was disdainful of Tony Blair. As anyone who has ever watched BBC knows, Jeremy Paxman sneers at everyone; it's an equal opportunity affair. Besides, as both Kieran and Calpundit point out, a little disrespect for politicians is hardly a bad thing for democracy.

Monday, February 17, 2003

I'm just back from a week at the Red Sea - funny how easy it was to get a rather cheap, last-minute winter-sun holiday in the middle east... I wish I had some searing insights from the region about the current international situation, but I'm afraid I got a bit side-tracked into a scuba-diving course and spent the week inhaling sea-water and looking around for looming hammerheads. (none actually loomed, but I get nervous & ticky while swimming in a heated pool in central Paris, so this was quite the personal challenge.) Anyway, spending a week or so trying not to drown is actually a really good way to get your mind off work.

I was really struck by the knee-jerk anti-Americanism you get over there, not to even mention people's views on Israel. OTOH, I suppose taxi drivers worldwide are not exactly noted for their nuanced views. But as a corollary to Henry's point about how unlikely it is that citizen protests will influence US policy (however unprecedentedly massive as was the case in London over the weekend) , it's also depressing to see how easy it is for failing or under-performing states to cultivate George Bush & co as all-purpose bogeymen who can be blamed, directly or indirectly, for the lack of opportunities etc. in those countries. This isn't a new point by any means, but it's really, really depressing to hear it and see it all around.

The Israelis stopped coming to Dahab a couple of years ago, right after the most recent intifada started (whether they're unsafe or just unpopular is moot.), so you don't even have those simple human exchanges between tourists and locals that can go a long way to normalising relations at the micro-level. I do agree with Henry that state actors will determine outcomes here - whether manipulating public opinion or just ignoring it. But there is something very sad and dangerous happening when people no longer have the chance to interact with 'the enemy' just enough to give a little pause before generalising and demonising them.