Flashback – (Mis)understanding Insurance

If they learn economics in journalism school, they must quickly forget everything upon graduation. Furthermore, when the facts don't make a compelling story, they resort to the usual tactic of trying to make stories fit their worldview or make things look scarier than they are. Here is a prime example I gave in December 2016.

[As I was reading the transcript of Scott Pelley’s "60 Minutes" interview with House Speaker Paul Ryan, I noticed that he seemed uninterested in hard news or in-depth information so much as he was interested in tripping up the Speaker, trying to put him in a position of disagreeing with his new boss, making one or the other of them look bad, or uncovering something potentially embarrassing.

He asked how often the two speak on the phone and who initiates the conversation. The answers were almost daily and both. No news there. How does he answer the phone? “He doesn’t say, ‘This is the president-elect?’” No. “Have you told him being president is not being CEO of the United States, that the Congress is going to have a say?” 

Instead of asking how the two got together after a contentious election, he asked, “Who apologized to whom?” It’s clear by now that Pelley has no liking or respect for Donald Trump, thinks he is a bully and a racist, and is searching for evidence to back up his views. Better yet, he would like to get Ryan to agree on any point that might make it seem he is of the same opinion.

The silliness and self-serving finally comes to a close, and Pelley asks a number of questions about policy issues. Soon he gets to the details about possible changes to Obamacare and the sniping continues. At one point Pelley says “And women will pay the same as men? That didn’t used to be the case.” This is a question designed to get an answer that will incite outrage. He is trying to get some admission of Republican bias against women, but showing in the process that he does not understand how insurance works and counting on the fact that many Americans don’t either.

Insurance usually works by assessing the risk and charging premiums accordingly. If you have homeowner’s insurance you expect a discount for having a working alarm system. Teen drivers are generally less safe than more experienced drivers, but boys have more accidents than girls. Auto insurance for a young man 16-25 is higher. There is no outrage there. It’s not unusual for companies to charge smokers more for their health insurance benefits. Owners of cars with higher repair costs pay higher premiums. Older cars are cheaper to insure due to the lower replacement cost. Those who don’t drive as many miles sometimes pay lower premiums. Costs of auto and homeowners insurance vary by what part of the country and by the size of the town or city you live in. And since women outlive men and take fewer chances, they pay less for life insurance. Older people pay more, as do those who participate in dangerous hobbies like skydiving or juggling chainsaws.

This all happens without a stir. Everyone seems to understand that certain classes of people are at a higher risk for either the frequency or the size of insurance claims. Hence they should pay more. The ones in the classes with higher premiums don’t like it, but they pay. So why would people be upset that some women, especially those of childbearing age, might have to pay more? That “used to be the case” and it didn’t have anything to do with prejudice or victimization.

Apparently the government and some group of citizens have now decided that charging women more for health insurance can be explained only by prejudice. Everyone must purchase the same insurance for the same cost or there will be an uproar. And Scott Pelley and others in his profession are more than happy to incite and later fan the flames of that uproar, because it makes their job of reporting the news so much easier. Their job is not to inform or to educate; their job is to attract views and clicks. Nothing does that better than a good demonstration or protest, even those grounded in fundamental misunderstanding.]

P.S. I have often said that problems with healthcare costs must be solved on the basis of costs, not by tinkering with health insurance, but that’s for another discussion.

Flashback – Why Is Color So Important?

My very first entry of 2013 addressed the power of color in decision-making in areas as different as medication and car buying. The point of these examples was to show how Americans are influenced by superficial characteristics, an indication of problems in the dimension of perspective. These many years later the media and certain groups are again focusing on color differences, particularly skin color, treating it as more important than substance and character. It seems we have made little progress since I wrote this.

[This thought about perspective was inspired by recent medical news about the color of pills and by a slightly older story about the color of cars. Perspective is about distinguishing between what’s important and what’s trivial, hence, living according to real values rather than values imposed by society. People strong in perspective look past external appearances and tend to adopt a lifestyle based on moderation. Common examples of poor perspective include the Black Friday stampedes and the accumulation of debt from buying to satisfy our wants and impulses or to impress others.

A key lesson is that appearances are often deceptive when it comes to judging what's really important.  Nevertheless, examples abound showing how people are overly influenced by external factors, in the following cases by color alone.

The first is a health report that came out earlier this week. Studies show that when the color of medication is changed, there is a greater a tendency for people to stop taking it. This occurred 27 to 50 percent of the time, and it is not a trivial problem. “Failure to take a prescribed medication — a behavior known as non-adherence — costs $290 billion annually in additional health complications, according to the New England Healthcare Institute.” Apparently generic medication, less expensive but identical to the brand name drug, may be manufactured by several companies. They don’t coordinate with each other on the color, nor do they take great pains to maintain consistency within each company.  People look at their pills and don’t recognize them or are confused by the color. Over-reliance on visual cues causes them to make poor decisions about continuing medication.

The influence of something as superficial as color extends beyond the health field. As this article points out, “BuyingAdvice.com [has found] that if a car is not available in the preferred color, 40 percent of drivers will decide to change brands.” With all the factors involved in deciding which car to buy:  safety, reliability, fuel economy, price, warrantee, insurance costs, and others; isn’t it surprising that 40% would switch brands – Ford instead of Toyota or Kia instead of Subaru – just because they can’t find the color they want? This is especially surprising since, when sitting inside a car, it’s very difficult to tell what color the car is! The color is visible only to other people. It could be ugly green or bright pink and you’d never know it until you got out.

When making major decisions, it's critical to put substantial factors ahead of superficial ones. Based on these stories alone, color is one of those external factors that wrongly holds considerable sway in decision making. A good New Year’s resolution might be to try to be less influenced by appearance and other external factors. Maybe we can start with pills and cars and work our way up to people.]

Wanted: A New National Anthem

The New National Anthem Committee is accepting applications. The current anthem has several flaws that must be addressed.

First, it is very difficult to sing. Second, the only verse that is usually sung is far too long. This becomes obvious by the fact the fans at sporting events get bored and restless, unable to maintain an attitude of respect and reverence toward the flag and country all the way to the end, whooping and hollering well before the last note has sounded. Starting criteria will be: easier to sing and shorter.

The current anthem is also objectionable for other reasons. One passage in the third verse, a verse most Americans didn’t even know existed until a controversy arose a few years ago, is by one interpretation objectionable and does not reflect twenty-first century values. (Note that this interpretation did not reflect twentieth century values when the anthem was adopted either, but general ignorance of its existence rendered the issue moot for over 80 years.)

The lyrics are about a war, sometimes called the second war for American independence. But the subject of war, any war, can be offensive to some.

Furthermore, the author, also a lawyer, had a mixed background. Francis Scott Key was a slave owner, but freed some of his slaves in the 1830s, paying one ex-slave as his farm foreman. He publicly criticized slavery and gave free legal representation to some slaves seeking freedom, but he also represented owners of runaway slaves.

When submitting a possible replacement anthem, this is important to remember. It is no longer acceptable to have wrong values and reform or to make a mistake and apologize. Every accusation of wrongdoing is tantamount to guilt in the court of public opinion with no statute of limitations. Mistakes or misstatements 30, 50 or 200 years ago have the same force as if they had happened yesterday. There is no forgiveness, so the work of any author submitted will be judged first by the purity of the author’s actions and reputation.

Finally and needless to say, the inclusion of the word “God” will lead to objections and immediate disqualification. Also, the use of words like “Free” and “Brave” are discouraged, as they are anathema to a society nearly devoid of responsibility, where the first instinct is to “sue the bastards,” or at least find someone else to blame for the slightest problem. Offense, supposed injury and victimhood get attention and sympathy; whereas personal responsibility, which used to be considered heroic based on previous American values and culture, is discouraged. Free and brave don't reflect the ethos of the time.

In short, avoid trying to be aspirational lest it be branded as being unrealistic and unrepresentative.

Send submissions to the New National Anthem Committee. Include email address and street address, the latter in case the Committee finds anything in the submission offensive or  objectionable in any way so that next time we are in your neighborhood we can vandalize your property and call it exercising our free-speech rights to protest.

The Baader-Meinhof Phenomenon

Baader-Meinhof is the name given to the phenomenon of a thing you've just noticed, heard of or experienced “suddenly cropping up constantly from different sources.” A common example is when a person becomes interested in buying a particular brand of car. Suddenly she begins to notice them everywhere. Or a friend mentions a popular song and later it comes up two or three more times in a short period. Also known as frequency illusion or recency illusion, it could be the result of a new awareness or a subconscious reaction to new information causing the brain to become selectively attentive.

Lately many news stories seem to follow the same theme. It wouldn’t be surprising for the entire society to be feeling a sense of this phenomenon and reacting to it. Are examples really more common or just more noticed?

Take for example, the recent story of the female TV reporter covering a fun run in Savannah, GA. The Huffington Post reports that one of the runners, a man wearing a hat and sunglasses, “smacked her backside as he ran past.” The offender “has been banned from future races after a video of the incident went viral.”

Then slapping became groping in this and several other stories: “Runner who groped reporter identified as local youth minister. Instead of a slap, CBS and others began to use the term grope in an effort perhaps to increase outrage.

The New York Post referred to him as the “pervy” jogger and a “creep.” 

In the wonderful world of new technology, technology that carries with it as many disadvantages as benefits allowing, for example, bullying to be raised to a new level of viciousness and relentlessness or one thoughtless comment to incite protests, boycotts and job losses, this grew from a localized incident of bad judgment into a national example of the prevalence of sexual harassment. 

This incident has created another celebrity victim: “It’s not playful. He hurt me both physically and emotionally.” The perpetrator, pervy jogger, creep, groper was given a national platform to apologize not only to the victim, but “to her family, her friends and her co-workers,” saying, “It was an awful act and an awful mistake.”

He’s lost his volunteer position and faced nationwide pillorying to his character and reputation based on a single misjudgment. Had it remained a local issue, he might have been charged with a misdemeanor. Instead he is another offender in the records of the Me-Too movement where examples are “suddenly cropping up constantly from different sources.”

What if a woman runner had done the same to a male reporter? I have met several women over the years who would have thought it both playful and funny. But that doesn’t fit the mold. It’s not confirmation bias or Baader-Meinhof. We are not sensitized to it. It wouldn’t have gone viral. 

And then, there was this story from the Business Insider, although ABC, the New York Times and the Washington Post as well as many other news organizations covered it. “West Point and the Naval Academy are investigating students giving hand gesture tied to white supremacy during Army-Navy broadcast.”

These are not new, unique, hateful hand signals. “Students from West Point and the Naval Academy were seen giving the ‘OK’ sign…during a pregame show.” A hand sign that has been used for almost 2000 years to mean OK (or something similar) was, as of three months ago, “added to the Anti-Defamation League's online database of hate symbols used by white supremacists and other far-right extremists.” I guess if they use it, it’s now off limits to everyone else. 

Talk about tyranny of the minority! According to a site called The Wrap, “White power groups are still decidedly on the fringes of society, especially compared to the prevalence of religious groups that preach positivity and acceptance.” And contrary to popular sentiment, the Southern Poverty Law Center lists fewer hate groups today than in 2013. But when hand signs at a football pregame make the news, the issue comes up again. There has to be an investigation into the intentions of these students.

Who is looking for and reporting hand signs on TV? Who thinks a local incident of acting like a complete jerk warrants national attention? Is life so easy or so boring in America that we have to search for problems, go out looking for reasons to be offended and upset? Do we have no perspective?

It Doesn’t Take Much

A number of weeks ago, one of my loyal readers sent me an email with this excerpt of an article on homeopathy saying I might find it interesting. 

“Something like 5 million adults and 1 million children use homeopathy, remedies that, in fact, contain no discernible amounts of the active ingredients…. Analysts project that the global market for homeopathic treatments will rise 12.5 percent by 2023, and already it’s a $1.2 billion industry. People are beginning to feel cheated: a nonprofit suing Walmart and CVS for hawking such snake oil conducted a survey that found 41 percent of people feel negatively about homeopathy when they learn about the pseudoscience behind it.”

I did find it interesting. I was familiar with the lawsuit mentioned and had referred to it earlier. But this time what struck me was the data from the survey. If 41% are willing to change their minds (and feel cheated) when presented with the fact that there is no science behind homeopathy, that means 59% were unmoved even in the face of good evidence. They were that strongly committed to their opinions. From a critical thinking standpoint, this is very disturbing. Why look for evidence just to ignore it?

My reader thought that those 59% were in trouble, but I responded that we are all in trouble. When more than a majority hold any particular opinion, it is so easy for that to become policy. Cowardly politicians, primarily interested in job security, will go along with any crazy idea.

This phenomenon is not limited to homeopathy or alternative medicine. When I looked through articles on the Post Truth Culture and ignored those that spin the erroneous notion that it began with the Trump presidency, I found this interesting opinion piece arguing that the source lies in the ideas of individual freedom and the trend toward personalizing every experience: especially things like clothing, entertainment and tattoos.

“If you take this culture of hyper-individualism to its extreme, one might come to believe that we have the right to believe whatever we want, to – even if those beliefs are immediately provably untrue… Freedom to believe in one's own, individual universe; freedom to pick and choose facts, and discard those that are disagreeable.”

So we continue to see headlines like this one from last month: “Kindergarten Vax Exemption Rates Up – Again.” The science doesn't matter when people can personalize reality.

Likewise in politics, some recent research shows that “party identification bests ideological identification. And most people will stick with their party long after they’ve abandoned their ideology.”

Critical thinkers would work out their ideological beliefs first and then support the party or candidate that best fits them. They would begin by deciding where they stand on issues before committing.

“The truth, it seems, is closer to the reverse: We choose our party for a variety of reasons – chief among them being the preferences of our family members, core groups, and community – and then we sign on to their platforms.” 

What’s even scarier than this total disregard for information and facts by vast numbers of people is that it takes only a few people, not close to a majority, or a few incidents to incite calls for new laws or even mob action.

In one example, in response to the death of an Indiana woman from strangulation by her pet boa constrictor, the Humane Society of the United States called for legislative action. The news item tells, “at least eighteen people have died from large constrictor snake related incidents in the United States since 1978 – 13 of those since 1990. If less than one death every two years calls for a new law, what of the 350 children who drown in swimming pools each year? 

Another is the legal battle between Oberlin College and a local bakery featured on CBS Sunday Morning. A shoplifting incident by an African American student led to protests and accusations of discrimination and white supremacy, resulting in a substantial loss of business for a local family-owned store. All it took was a few activists using social media to spread a slanted story.

There are so many other examples where a minor action, incident or comment gets people up in arms, demanding changes, revenge or satisfaction, often based not on the facts or intention, but on the firm beliefs of the group. No amount or logic, reason or science will persuade them to change their minds.

Power of the Behavioral Model

I have mentioned before how correctly using the behavioral model eliminates the kind of name-calling and attribution of negative motives that are so common. Using the model requires a little skill and practice, but mostly paying attention.

It’s based on the old adage of punish the behavior and not the child. Good parents don’t call their children bad; they ask for better behavior.

As an easy example, take the spouse (or teen) coming home later than expected. The other party is waiting up, feeling worried and upset, ready to pounce when the door opens. “You promised to be home by X! Don’t you care about my feelings? You are so inconsiderate! You don’t care about me (or your family)!” And on it goes. The other person gets defensive, possibly angry, especially if there is a good explanation – some accident or emergency.

The behavior is coming home late. Both can agree. Even if there is not a good reason, there may still be a solution that both can agree on without antagonistic remarks. But in the heat of the moment, it’s hard to discuss only behavior without affixing blame and bad intentions.

This is hard even for journalists who we expect to be objective. This Atlantic article published a few days after the Lincoln Memorial incident is instructive. By then several videos had become available showing different sides of the story, but people still couldn’t stick to the facts – they couldn’t report the behavior without assigning motives.

In the original picture, a student, “wearing a ‘Make America Great Again’ hat, smiles before an Omaha tribal elder, a confrontation viewers took as an act of aggression by a group of white youths against an indigenous community – and by extension, people of color more broadly.” The behavior was standing, wearing a certain hat and smiling. It was automatically racist. He didn’t just hate the individual; he hated all Native Americans as well as every other minority. The smile was called a smirk, when it could have meant he felt nervous having an adult in his personal space beating on a drum.

Later video showed that the tribal elder moved toward the student (not the other way around). Which was the act of aggression? Possibly neither. We don’t know what they were thinking. Neither said anything to indicate what they were thinking, but observers on both sides were sure they knew. The tribal elder later said it felt hostile “and caused him and his companions to fear for their safety.” In that case why did he move forward? What behavior gave him that impression? Follow-up questions are called for.

The explosion of emotion led to condemnation on social media of the student, and by extension, other students at his school, the school itself and even Catholic education! No behavior to support any of this – but let’s throw in some death threats.

The story was much more complex, but most people made up their minds and moved on. The article even says about the students, “their actual intentions and motivations seem vital to any account of what took place. But not only can we never really know what those were, they also don’t matter once the original video has been shot and shared.”

Had this happened only 15 years ago, the incident would have gone unnoticed except for the people involved. Those heckling the students would have felt satisfied that they stood up for their beliefs. The students would have gone home with a story of an unexpected confrontation with a tribal elder. He, in turn, may have felt proud of his role.

But thanks to new technology, national news got to broadcast erroneous first impressions. Even with new evidence, the New York Times tried to soften their original take by reporting a revised opinion “that an explosive convergence of race, religion and ideological beliefs – against a national backdrop of political tension – set the stage for the viral moment.” Of course uninvolved citizens across the country got to express outrage for or against the student(s) complete with name-calling and insults. It’s mob mentality carried out on smart phones.

It’s easy to look at behavior and jump to conclusions. It’s also gratifying, if we can uncover a conclusion that satisfies our own preconceived prejudices. The article itself even calls a MAGA hat “an almost perfect avatar for apparent white nationalism.” It’s a sad state when a hat can set off such an emotional firestorm! Behavior like this does not lead to a happy ending, and it's time we all stopped jumping to a favored conclusion and blaming the other side long enough to figure that out.

Learning From France

Over five years ago I wrote a piece with the title “Learningfrom Italy,” and earlier this week I wrote about “Learning From Harvey.”

One benefit of behavior having consequences is the ability to use those consequences as feedback to make changes and corrections – or to continue on the same course while enjoying favorable outcomes.  When a bad situation can be traced to our own choices, it makes sense to change.  Many people figure this out.  The wiser ones look at the behavior of others, those who are struggling, to discover what behavior to avoid before they encounter the same difficulties.  Learning from the mistakes of others is always the recommended path.

What struck me about the news from France last week was the Washington Post headline about their president:  “French President Macron has spent $30,000 on makeup services in just 3 months.”  That comes out to about $330 per day.  “The fees were apparently for doing up the president in advance of news conferences, public appearances and various travels.”  (And he’s doing this while trying to cut government spending!)

But as long as we are looking at France, what about Macron’s predecessor?  Going back to a New York Times article from about 15 months ago, “President François Hollande’s personal hairdresser has been paid 9,895 euros – over $10,000 – per month since Mr. Hollande was elected in 2012, about the same amount as a government minister’s salary.”  That comes out to a total of close to half a million dollars – for haircuts!  The previously cited WAPO article points out that the makeup spending of Hollande and Nicolas Sarkozy, who was president before him, was not much different from Macron’s.

French voters are suspicious of their motives for such extravagant spending.  They accuse their leaders of being vain and out of touch.  But as politicians in a digital age, they probably recognize the power of optics.  Anyone who wants to make them look bad need not go to all the trouble of debating official behavior.  All they need are some unflattering pictures to promote a negative impression.  Everyone in the public eye must always look their best, lest their opponents take advantage.

Who decides that?  It’s not the politicians nor the advisors nor the press.  It’s the voters themselves – who not only vote, but also purchase products, attend movies and back causes using the same criteria.  This need for optimal optics is more evidence of the victory of the superficial over the substantive – and that’s a perspective issue.  How much better off would the French citizens be if they put more stock in competence than in appearance.  Shouldn’t we learn from them to avoid facing the same problems here?

That would be great, but everyone knows the same kind of book-by-its-cover judging goes on in America to at least the same extent, as attractive movie stars are allowed to claim credibility on subjects they have no expertise in, from vaccinations to climate change.  Celebrities run for office and win based on popularity rather than qualifications. 

Ordinary Americans also understand the power of appearance in their personal lives spending over $60 billion a year on beauty and cosmetics.  As another example, check out this on-line eyeglasses site offering 200,000 different frames with, of course, many choices of designer brands.  For glasses these days, it’s less about seeing than being seen.  The examples are legion from designer clothing and accessories to fine wine and impressive cars!  (Possibly the core of the race-relations problems and other discriminatory practices in America is the looks-like-me criteria unconsciously practiced by hiring managers and others, and assumed as an imperative when children choose a role model.  Even the concept of diversity is defined more by appearance than true variety of contributions.)

Who are we trying to impress, or a better question may be, why do we let ourselves be so easily impressed by surface characteristics?

How much better off could we be if we wisely learned from the French, demanding our public figures act the part rather than look the part – and especially embedding that philosophy into the rest of our behavior.

Diversity II: The Power of Genetics

CBS Morning News reported on a new study published in Nature looking at 350,000 people worldwide that showed genetic diversity of parents had no health effects on their children.  In the process, however, they did find another surprising result.  “Greater genetic diversity is linked to an increase in height and enhanced cognitive function, a new study finds.”

I found a couple of aspects of this study interesting.  The first question I had was whether this was another one of those studies where so many variables were tested that it was likely that at least one or two of them would show statistical significance – a kind of throw-it-at-the-wall-and-see-what-sticks approach to science.  Does it count when they are looking at one thing, health effects for example, and another one pops up in an oh-look-what-I-found way?  It was a very large sample size, but it seemed a little odd that they expressed it in number of people, when they were actually sampling couples.  Finally, I was a little surprised that they could find and test DNA samples from both parents for such a large number of people.

To figure some of this out I went to the study.  There was no genetic testing.  The differences were inferred from the fact that parents came from geographically distinct areas or from socially isolated population, e.g. Amish.  Since the world has become better connected, it is now more likely that individuals from genetically different populations would meet and mate, which may help explain in part why in the general population height and measured intelligence have been increasing.  (It has somewhat the opposite effect of inbreeding – except that analysts found no particular health implications.)

The journalists who reported this seemed from their questions and reactions to take for granted that genetically diverse is the same as racially diverse, the popular definition of diversity.  This brings up another question:  Really how genetically different are what are commonly referred to as different races?  There is some science here. 

An interesting article from last year explains:  Human races are not natural genetic groups; they are socially constructed categories.  Furthermore, the level of genetic differentiation between human populations falls well below the threshold that biologists typically use to define races in non-human species.” 

Other recent research shows that race can be distinguished by DNA analysis.  But this 2014 Time article is careful to point out that the differences are minuscule.  “The overwhelming verdict of the genome is to declare the basic unity of humankind.”

We should find this to be refreshing.  Instead of emphasizing differences we would be well justified to concentrate on our similarities.  If we are genetically 96% similar to a chimpanzee, how different from each other can we really be – regardless of physical characteristics?