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	<title>Kevin Hoffberg&#039;s Blog &#187; Decision Making</title>
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	<description>The search for good decisions continues</description>
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		<title>Investors and Uncertainty, a Bad Mix</title>
		<link>http://kevinhoffberg.com/blog/2010/11/23/investors-and-uncertainty-a-bad-mix/</link>
		<comments>http://kevinhoffberg.com/blog/2010/11/23/investors-and-uncertainty-a-bad-mix/#comments</comments>
		<pubDate>Tue, 23 Nov 2010 19:44:29 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Behavioral Economics]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[John Cassidy]]></category>
		<category><![CDATA[Paul Woolley]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=1127</guid>
		<description><![CDATA[The foundation to behavioral economics is the idea that investors are not rational actors: That they overreact to uncertainty, are influenced by immaterial information, and act for all manner of reasons not consistent with their best interests (utility). I found a paper the other day published by The Paul Woolley Centre for the Study of Capital Market [...]]]></description>
			<content:encoded><![CDATA[<p></p><div>
<p>The foundation to behavioral economics is the idea that investors are not rational actors: That they overreact to uncertainty, are influenced by immaterial information, and act for all manner of reasons not consistent with their best interests (utility). I found a paper the other day published by <a href="http://www.business.uts.edu.au/qfrc/pwc/index.html">The Paul Woolley Centre for the Study of Capital Market Dysfunctionality</a> called <a href="http://www.business.uts.edu.au/qfrc/pwc/research/workingpapers/2010/wp8.pdf">How Do Investors React Under Uncertainty?</a> that reinforces this point.  Here&#8217;s a clip from the conclusion:</p>
<blockquote><p><em>It is proposed that uncertainty, rather than risk, provides a much more realistic representation of the setting that we face when we come to pricing asset, and particularly corporate equities. We have gone a long way down the path of developing pricing models that incorporate risk (e.g. CAPM, APT, Fama and French empirical three-factor model) but comparatively little work has been done on the role (if any) that uncertainty plays in asset pricing. In order for uncertainly to affect pricing, it must have some influence on how investors incorporate information into pricing. Our contribution is to evaluate whether uncertainty influences the way by which investors respond to earnings announcements which will provide us with valuable insights as to the role that uncertainty plays in asset pricing.</em></p>
<p><em>In particular, we evaluate the proposition that investors will follow maxmin expected utility and so will progressively overweight bad news and underweight good news as they become more uncertain. Using VIX as a proxy for market uncertainty and earnings announcements as our information signal, we find that there is an asymmetric response to good and bad earnings news at high levels of uncertainty which is consistent with uncertainty breeding pessimism in the minds of investors. However, we do find evidence to suggest investors might have a more optimistic bent than is allowed under maxmin expected utility as indicated by how they react to earnings announcements when uncertainty is at the lower end of the scale.</em><br />
<em><br />
</em></p></blockquote>
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		</item>
		<item>
		<title>The Numbers Are Against Good Government</title>
		<link>http://kevinhoffberg.com/blog/2010/08/16/the-numbers-are-against-good-government/</link>
		<comments>http://kevinhoffberg.com/blog/2010/08/16/the-numbers-are-against-good-government/#comments</comments>
		<pubDate>Tue, 17 Aug 2010 00:00:52 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Current Affairs]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Dodd-Frank]]></category>
		<category><![CDATA[H.R. 3590]]></category>
		<category><![CDATA[H.R. 4173]]></category>
		<category><![CDATA[Patty Murray]]></category>
		<category><![CDATA[Word Count]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=1028</guid>
		<description><![CDATA[I have been in a running debate with a friend and colleague generally about the topic of whether or not our elected officials are able to vote knowledgeably given the large number of bills they need to track, the size of their staff, and the competing need to raise money and attend to constituents. It [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>I have been in a running debate with a friend and colleague generally about the topic of whether or not our elected officials are able to vote knowledgeably given the large number of bills they need to track, the size of their staff, and the competing need to raise money and attend to constituents. It got me to wondering about what kind of numbers are we really talking about so I went looking.</p>
<p>Here are the raw numbers for the 111th Congress according to the <a href="http://thomas.loc.gov/home/Browse.php?n=bills&amp;c=111">Library of Congress</a>:</p>
<ul>
<li>House Bills: 6097</li>
<li>House Concurrent Resolutions: 100</li>
<li>House Joint Resolutions: 95</li>
<li>House Resolutions: 100</li>
<li>Senate Bills: 3751</li>
<li>Senate Concurrent Resolutions: 71</li>
<li>Senate Joint Resolutions: 38</li>
<li>Senate Resolutions: 100</li>
</ul>
<p>That&#8217;s a lot of bills and resolutions, particularly given our legislators spend only about 140 days a year on the business of the people. Obviously there is a big difference between the number of things that are introduced and the number that our elected officials need to pay attention to. So let&#8217;s check out a couple of those.</p>
<p>One of the bills that has gotten a lot of attention lately is H.R.4173 &#8211; Dodd-Frank Wall Street Reform and Consumer Protection Act: &#8220;A bill to promote the financial stability of the United States by improving accountability and transparency in the financial system, to end &#8220;too big to fail&#8221;, to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.&#8221;</p>
<p>Bills go through a number of iterations from the time they are introduced to the time they get passed. Checking in over at <a href="http://www.opencongress.org/bill/111-h4173/text">OpenCongress</a> here&#8217;s what we find:</p>
<table class="simple-table2" cellspacing="0" width="100%">
<tbody>
<tr>
<th align="left" scope="col">Version</th>
<th align="left" scope="col">Word #</th>
<th align="left" scope="col">Changes From Previous</th>
<th align="left" scope="col">% Change</th>
</tr>
<tr>
<td style="padding-left: 2px;">Introduced in House</td>
<td>223,783</td>
<td>n/a</td>
<td>n/a</td>
</tr>
<tr>
<td style="padding-left: 2px;">Engrossed in House</td>
<td>301,214</td>
<td><span style="margin-right: 20px;">2,502</span></td>
<td>43%</td>
</tr>
<tr>
<td style="padding-left: 2px;">Referred in Senate</td>
<td>299,585</td>
<td><span style="margin-right: 20px;">8</span></td>
<td>0%</td>
</tr>
<tr>
<td style="padding-left: 2px;">Engrossed Amendment Senate</td>
<td>283,985</td>
<td><span style="margin-right: 20px;">9,370</span></td>
<td>90%</td>
</tr>
<tr style="background: #D9D9F3;">
<td style="padding-left: 2px;">Enrolled Bill</td>
<td>383,013</td>
<td><span style="margin-right: 20px;">4,478</span></td>
<td>50%</td>
</tr>
</tbody>
</table>
<p>The big health reform bill is H.R.3590 - Patient Protection and Affordable Care Act. As passed it weighs in at 327,911 words. Keep in mind that both of the bills cited contain vast tracts of language the direct the relevant regulator or agency to promulgate hundreds of thousands more words in the form of rules and regulations to sort out what those original 700,000 words really mean.</p>
<p>Just as an aside on this one, check out this link if you want to see the <a href="http://www.opencongress.org/bill/111-h3590/money">stunning amounts of money</a> that were given to various of our elected officials, I assume in order to influence their votes (could there be another explanation?). The one I like the best is Senator Scott Brown from Massachusetts. He managed to be on the job for a few weeks before role call. That didn&#8217;t stop him from taking in $997,923 from parties specifically interested in this bill.  But I digress.</p>
<p>Those seem like pretty hefty numbers to me.  All those bills. Two big ones adding up to 700,00 words all by themselves. But surely our elected officials have a big staff to help? So off I went to <a href="http://www.legistorm.com/member/73/Sen_Patricia_Lynn_Murray/68.html">check out one of my senators, Patty Murray</a>.</p>
<h4>Displaying salaries for time period: 10/01/09 &#8211; 03/31/10</h4>
<table class="salary">
<thead>
<tr>
<th id="sf_user_list_th_staffer"><a href="/member/73/Sen_Patricia_Lynn_Murray/68/staffer/asc.html">Payee Name</a></th>
<th id="sf_user_list_th_start_date"><a href="/member/73/Sen_Patricia_Lynn_Murray/68/start_date/asc.html">Start date</a></th>
<th id="sf_user_list_th_end_date"><a href="/member/73/Sen_Patricia_Lynn_Murray/68/end_date/asc.html">End date</a></th>
<th id="sf_user_list_th_salary_title_id"><a href="/member/73/Sen_Patricia_Lynn_Murray/68/salary_title_id/asc.html">Position</a></th>
<th id="sf_user_list_th_salary"><a href="/member/73/Sen_Patricia_Lynn_Murray/68/salary/asc.html">Amount</a></th>
</tr>
</thead>
<tbody>
<tr>
<td><a href="/person/Stephanie_S_Arnold/61715.html">Stephanie S. Arnold</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Aide</td>
<td class="text-right">$19,500.00</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Jared_E_Axelrod/68804.html">Jared E. Axelrod</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Mail Administrator</td>
<td class="text-right">$20,070.13</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Sheila_M_Babb/5933.html">Sheila M. Babb</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Deputy State Director</td>
<td class="text-right">$39,666.64</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Sherri_A_Berdine/129839.html">Sherri A. Berdine</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Staff Assistant</td>
<td class="text-right">$16,333.28</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Jennifer_M_Berg/129841.html">Jennifer M. Berg</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Constituent Services Representative/Grants Coordinator</td>
<td class="text-right">$19,666.64</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Steven_F_Bergsbaken/5374.html">Steven F. Bergsbaken</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Mail Manager</td>
<td class="text-right">$22,833.28</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Shawn_L_Bills/5921.html">Shawn L. Bills</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Northwest Washington Regional Director</td>
<td class="text-right">$27,999.92</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Jeff_E_Bjornstad/14528.html">Jeff E. Bjornstad</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Chief of Staff</td>
<td class="text-right">$78,833.33</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Sarah_W_Bolton/50900.html">Sarah W. Bolton</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Aide</td>
<td class="text-right">$18,499.92</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Kim_A_Brown/50479.html">Kim A. Brown</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Constituent Services Representative</td>
<td class="text-right">$20,999.92</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Paula_J_Burg/37255.html">Paula J. Burg</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$44,666.60</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Mary_J_Conway/5903.html">Mary J. Conway</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Community Outreach Representative</td>
<td class="text-right">$22,333.28</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Carole_S_Cory/5908.html">Carole S. Cory</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Systems Administrator</td>
<td class="text-right">$25,333.28</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Sergio_R_Cueva_Flores/68805.html">Sergio R. Cueva Flores</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>King County Director</td>
<td class="text-right">$22,999.96</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Carrie_E_Desmond/5907.html">Carrie E. Desmond</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$25,124.95</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Alexandra_S_Glass/5916.html">Alexandra S. Glass (Alex)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Communications Director</td>
<td class="text-right">$60,333.28</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Mary_Kay_Glenn/5934.html">Mary Kay Glenn</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Front Office Coordinator</td>
<td class="text-right">$18,666.64</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Adam_S_Goodwin/61720.html">Adam S. Goodwin</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Staff Assistant</td>
<td class="text-right">$16,666.64</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/David_M_Hodges/147309.html">David M. Hodges</a></td>
<td>12/16/09</td>
<td>03/31/10</td>
<td>Constituent Services Representative</td>
<td class="text-right">$10,602.91</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Joshua_D_Jacobs/5953.html">Joshua D. Jacobs</a></td>
<td>10/01/09</td>
<td>10/02/09</td>
<td>Legislative Assistant</td>
<td class="text-right">$2,999.99</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Geoff_Kirkwood/37247.html">Geoff Kirkwood</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Aide</td>
<td class="text-right">$18,499.92</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Amaia_P_Kirtland/3430.html">Amaia P. Kirtland</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Office Manager</td>
<td class="text-right">$7,166.65</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Brian_L_Kristjansson/5928.html">Brian L. Kristjansson</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>State Director</td>
<td class="text-right">$52,166.64</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Samuel_Kussin_Shoptaw/147310.html">Samuel Kussin-Shoptaw</a></td>
<td>03/30/10</td>
<td>03/31/10</td>
<td>Staff Assistant</td>
<td class="text-right">$77.77</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Grant_W_Lahmann/33108.html">Grant W. Lahmann</a></td>
<td>10/01/09</td>
<td>01/15/10</td>
<td>Legislative Aide</td>
<td class="text-right">$10,997.17</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Travis_T_Lumpkin/2700.html">Travis T. Lumpkin</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$43,166.60</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Jennifer_C_Martinez/129840.html">Jennifer C. Martinez</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Eastern Washington Representative</td>
<td class="text-right">$17,749.92</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Matthew_W_McAlvanah/25176.html">Matthew W. McAlvanah (Matt)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Press Secretary</td>
<td class="text-right">$38,000.00</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Mary_E_McBride/5911.html">Mary E. McBride</a></td>
<td>10/01/09</td>
<td>02/26/10</td>
<td>Sounth Sound/Olympic Peninsula Director</td>
<td class="text-right">$24,944.36</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Rebecca_L_Mengelos/50475.html">Rebecca L. Mengelos</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Central Washington Director</td>
<td class="text-right">$21,666.64</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Evan_D_Miller/147306.html">Evan D. Miller</a></td>
<td>10/28/09</td>
<td>03/31/10</td>
<td>Director, Specialty Media</td>
<td class="text-right">$11,124.93</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Miriam_D_Mina/68803.html">Miriam D. Mina</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Constituent Services Representative</td>
<td class="text-right">$17,749.92</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Sean_James_Murphy/45785.html">Sean James Murphy</a></td>
<td>03/01/10</td>
<td>03/31/10</td>
<td>Regional Director, South Puget Sound</td>
<td class="text-right">$4,000.00</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Carey_R_Nickels/147307.html">Carey R. Nickels</a></td>
<td>11/04/09</td>
<td>12/04/09</td>
<td>Staff Assistant</td>
<td class="text-right">$2,411.08</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Edward_J_O_Neill/5927.html">Edward J. O&#8217;Neill (Ed)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Deputy State Director</td>
<td class="text-right">$36,500.00</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Lauren_R_Overman/61718.html">Lauren R. Overman</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Aide</td>
<td class="text-right">$19,166.64</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Jason_A_Park/25177.html">Jason A. Park</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$40,833.28</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Maribel_Peralez/147308.html">Maribel Peralez</a></td>
<td>12/08/09</td>
<td>01/13/10</td>
<td>Staff Assistant</td>
<td class="text-right">$2,877.06</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Nathanael_David_Prestwood/20706.html">Nathanael David Prestwood (David)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Senior Policy Adviser</td>
<td class="text-right">$6,500.00</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Kristine_M_Reeves/75797.html">Kristine M. Reeves</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Kitsap and Olympic Peninsula Director</td>
<td class="text-right">$22,583.30</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Stacy_L_Rich/447.html">Stacy L. Rich</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Leadership Adviser</td>
<td class="text-right">$6,500.00</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Grace_E_Rooney/34607.html">Grace E. Rooney</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Executive Assistant/Scheduler</td>
<td class="text-right">$7,499.99</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Andrew_Rowe/37249.html">Andrew Rowe (Andy)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Aide</td>
<td class="text-right">$19,499.96</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Evan_Tyler_Schatz/27903.html">Evan Tyler Schatz</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Director</td>
<td class="text-right">$77,250.00</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Jaime_L_Shimek/5939.html">Jaime L. Shimek</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$41,666.64</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Neely_Marcus_Silbey/33027.html">Neely Marcus Silbey</a></td>
<td>01/14/10</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$17,111.09</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Michael_D_Spahn/225.html">Michael D. Spahn (Mike)</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Press Secretary</td>
<td class="text-right">$6,861.44</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Anna_K_Sperling/75798.html">Anna K. Sperling</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Deputy Scheduler</td>
<td class="text-right">$17,166.60</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Erin_K_Vincent/129842.html">Erin K. Vincent</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Eastern Washington State Director</td>
<td class="text-right">$22,999.96</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Anne_Walden_Newman/143616.html">Anne Walden-Newman (Annie)</a></td>
<td>02/01/10</td>
<td>03/31/10</td>
<td>Staff Assistant</td>
<td class="text-right">$4,666.64</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Theresa_Weil/30739.html">Theresa Weil</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Southwest Washington Director</td>
<td class="text-right">$27,999.92</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Erika_A_O_Whinihan/61719.html">Erika A.O. Whinihan</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>State Scheduler</td>
<td class="text-right">$25,499.96</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Bethany_R_Works/75796.html">Bethany R. Works</a></td>
<td>10/01/09</td>
<td>01/06/10</td>
<td>Southwest Washington Regional Representative</td>
<td class="text-right">$8,666.62</td>
<td> </td>
</tr>
<tr class="even">
<td><a href="/person/Kathryn_H_Young/37254.html">Kathryn H. Young</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Legislative Assistant</td>
<td class="text-right">$41,833.28</td>
<td> </td>
</tr>
<tr>
<td><a href="/person/Eliezer_O_Zupnick/129838.html">Eliezer O. Zupnick</a></td>
<td>10/01/09</td>
<td>03/31/10</td>
<td>Deputy Press Secretary</td>
<td class="text-right">$27,333.28</td>
<td> </td>
</tr>
</tbody>
<tfoot>
<tr>
<th colspan="6">55 results</th>
</tr>
</tfoot>
</table>
<p>Keep in mind that this is half the term so the payroll for a fiscal year is roughly double. A couple of things stand out on this one.</p>
<p>Ms. Murray spent n<a href="http://www.komonews.com/news/local/100075759.html">early $4 million in one month in her campaign for reelection</a>. Not to worry, she still has another $3.2 million in the bank. If I were more ambitious I would go looking for her total campaign spend but those two numbers are impressive enough . . . and they&#8217;re trivial in comparison to some of the big bucks campaigns going on in California and Connecticut. Juxtapose that against her total pay of $174,000 and her entire payroll of about $2.6 million. Representative Scott Murray of New York took in half that amount of money just from spenders with an interest in one bill relating to health care reform.</p>
<p>On purely dollars and cents basis, Senator Murray spends considerably more money to get the job than she does on doing the job.</p>
<p>Of the 55 names I count just 15 with the word &#8220;legislative&#8221; in the title. The highest paid is the Legislative Director who is raking in $145,000 which is less than a first year associate makes at a front line law firm.  There are a couple of others who make $80,000ish, and the rest are making less than $20 an hour. The staff of the various House and Senate committees are paid similar (low) dollars and are stretched every bit as thin . . . the ones I know work punishing hours, don&#8217;t take vacations, and don&#8217;t get outside nearly enough.</p>
<p>I&#8217;m not picking on Senator Murray. She is no worse than representative of the other 99 Senators when it comes to the size of her staff, what she pays, how much money she raises, and how much she spends on her own election as well as those of her Democratic colleagues. In fact, she probably comes off as cheap.</p>
<p>Maybe it&#8217;s just me, and I say this with all due respect to the smart, motivated, hard working members of our legislators&#8217; staffs, but this doesn&#8217;t seem like the kind of firepower you need to deal with the blizzard of bills and resolutions yet alone face off against all the big money players who are trying to influence the direction, course, and outcome of legislation.</p>
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		<title>The Summer of Numerical Discontent</title>
		<link>http://kevinhoffberg.com/blog/2010/07/28/the-summer-of-numerical-discontent/</link>
		<comments>http://kevinhoffberg.com/blog/2010/07/28/the-summer-of-numerical-discontent/#comments</comments>
		<pubDate>Wed, 28 Jul 2010 18:28:33 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Current Affairs]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Bush]]></category>
		<category><![CDATA[Clinton]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Obama]]></category>
		<category><![CDATA[Reagan]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=805</guid>
		<description><![CDATA[I went walking with a friend last night and we got to talking about Obama&#8217;s polling numbers and the general uselessness of trying to project forward to 2012 and his political fortunes. So I went looking. John Woolley and Gerhard Peters have an excellent site where they publish their work on The American Presidency Project. [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>I went walking with a friend last night and we got to talking about Obama&#8217;s polling numbers and the general uselessness of trying to project forward to 2012 and his political fortunes.  So I went looking.</p>
<p>John Woolley and Gerhard Peters have an excellent site where they publish their work on <a href="http://www.presidency.ucsb.edu/data/popularity.php">The American Presidency Project</a>. It&#8217;s an absolute treasure trove.  To the subject of approval ratings, we find that Obama&#8217;s numbers have moved from a high of 69 points early in his administration to the mid 40s 19 months in (currently 44%).</p>
<p><a href="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Obama-Approval.jpg"><img class="aligncenter size-medium wp-image-807" title="Obama Approval" src="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Obama-Approval-300x205.jpg" alt="" width="300" height="205" /></a></p>
<p>And what of W?  He entered office with much lower approval numbers, due in large part to the legal fracas surrounding his losing the popular vote but winning the Supreme Court vote: 9/11 handed him a popularity coup sending his approval ratings soaring to 89%.  19 months in his approval ratings had settled back to 68% and by the mid-term elections were closer to Obama&#8217;s current numbers at 48%.  At the end, only 34% approved of Bush&#8217;s performance.</p>
<p><a href="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/W-Approval.jpg"><img class="aligncenter size-medium wp-image-810" title="W Approval" src="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/W-Approval-300x209.jpg" alt="" width="300" height="209" /></a></p>
<p style="text-align: left;">Clinton, despite his manifest personal troubles entered office with a 58% approval rating and left with a 66% rating, astonishing given the rise of the conservative attack machine during his administration. Only Reagan and Bush the Elder managed the same trick. 19 months in his approval rating had also dropped, oddly to 42%, essentially the same as Obama&#8217;s.  At the time of his re-election, his approval ratings stood at 58%.</p>
<p style="text-align: left;"><a href="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Clinton-Approval.jpg"><img class="aligncenter size-medium wp-image-811" title="Clinton Approval" src="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Clinton-Approval-300x210.jpg" alt="" width="300" height="210" /></a></p>
<p style="text-align: left;">Bush Senior&#8217;s popularity curve looks like a roller coaster.  He entered office at 51% and left at 56%.  As was true with his son, his ratings soared to 82% during Desert Storm, seemingly proving that America loves a tough guy, at least for awhile.</p>
<p style="text-align: left;"><a href="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Bush-Approval.jpg"><img class="aligncenter size-medium wp-image-812" title="Bush Approval" src="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Bush-Approval-300x206.jpg" alt="" width="300" height="206" /></a></p>
<p>And what of the Lion of the Right?  Reagan took over from a President suffering 34% approval ratings, due to many things not the least of which was the Iranian Hostage Debacle.  Despite the fact that Reagan won the electoral vote going away, he entered office with an approval rating of 51%.  At the 19 month mark his approval ratings stood EXACTLY where Obama&#8217;s do, 44%.  At his re-election, his popularity stood at 61%, roughly the same as Clinton&#8217;s.</p>
<p><a href="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Reagan-Approval.jpg"><img class="aligncenter size-medium wp-image-809" title="Reagan Approval" src="http://kevinhoffberg.com/blog/wp-content/uploads/2010/07/Reagan-Approval-300x209.jpg" alt="" width="300" height="209" /></a></p>
<p>Conclusions?  The first is what investment prospectuses always tell you: Past performance is not indication of future performance.  This has to be one of the most common, most insidious decision-faults going: looking at data about the past (data, by definition is always about the past) and using it to project the future.  Project is actually an apt descriptor, as it is an exercise in projecting our hopes, dreams, fears, fobias, and preconceptions on the future based on what we see in the past.</p>
<p>A second possible conclusion is the lesson of Bill Clinton: It&#8217;s the economy stupid.</p>
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		<title>Winning The UnWinnable</title>
		<link>http://kevinhoffberg.com/blog/2010/07/02/winning-the-unwinnable/</link>
		<comments>http://kevinhoffberg.com/blog/2010/07/02/winning-the-unwinnable/#comments</comments>
		<pubDate>Fri, 02 Jul 2010 21:50:05 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Current Affairs]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Afghanistan]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Michael Steele]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=802</guid>
		<description><![CDATA[At the risk of beating a dead horse . . . Yesterday I blogged on what I regard as the craziness of spending billions of dollars on Afghanistan.  My lens on the problem was primarily the math but mostly it was about the impossibility of success given the frame on the problem. Low and behold [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>At the risk of beating a dead horse . . . Yesterday I blogged on what I regard as the <a href="http://kevinhoffberg.com/blog/2010/07/01/the-madness-of-afghanistan-and-a-little-trick-i-call-math/">craziness of spending billions of dollars on Afghanistan</a>.  My lens on the problem was primarily the math but mostly it was about the impossibility of success given the frame on the problem.</p>
<p>Low and behold the always entertaining GOP Chairman Michael Steele was thinking the same thing.  Sort of.</p>
<p>The story everyone is focusing on his yet another <a href="http://thecaucus.blogs.nytimes.com/2010/07/02/dust-up-over-steeles-view-of-afghan-war">Steele-gaffe</a>.</p>
<blockquote><p>Michael Steele, chairman of the Republican National Committee, drew fierce criticism on Friday after declaring at a party fund-raiser that the United States was on the wrong side of history with its conflict in Afghanistan, a military fight he called “a war of Obama’s choosing.”</p>
<p>“This is not something the United States had actively prosecuted or wanted to engage in,” Mr. Steele said in a speech on Thursday evening in Connecticut in which he offered a strong critique of President Obama’s military strategy.</p>
<p>“It was the president who was trying to be cute by half by flipping a script demonizing Iraq, while saying the battle really should be Afghanistan,” Mr. Steele said, according to a video of his remarks that was circulated by Democrats on Friday. “”Well, if he’s such a student of history, has he not understood that you know that’s the one thing you don’t do, is engage in a land war in Afghanistan?”</p></blockquote>
<p>Wow.  Really? More than enough people have piled on this one so I won&#8217;t bother to comment beyond wondering when the spaceship is scheduled to return to the planet Mr. Steele comes from. No, the part that gets me spouting is what comes next.</p>
<blockquote><p>Mr. Steele, seeking to clarify his remarks, issued a statement on Friday afternoon, saying, “There is no question that America must win the war on terror.”</p></blockquote>
<p>And this . . .</p>
<blockquote><p>“For the sake of the security of the free world, our country must give our troops the support necessary to win this war,” Mr. Steele said. “As we have learned throughout history, winning a war in Afghanistan is a difficult task. We must also remember that after the tragedy of Sept. 11, 2001, it is also a necessary one.”</p>
<p>He added: “That is why I supported the decision to increase our troop force and, like the entire United States Senate, I support General Petraeus’s confirmation. The stakes are too high for us to accept anything but success in Afghanistan.”</p></blockquote>
<p>I have a good friend named John who always kindly reminds me that politicians aren&#8217;t to be listened to, especially when they&#8217;re talking to the true believers as was the case with Mr. Steele. Notions like telling the truth (in all its forms) are really only suggestions in these instances. My issue is more pedantic: You can&#8217;t solve a problem when you define it like . . .</p>
<blockquote><p>“There is no question that America must win the war on terror.”</p></blockquote>
<blockquote><p>&#8220;The stakes are too high for us to accept anything but success in Afghanistan.&#8221;</p>
<p>“As we have learned throughout history, winning a war in Afghanistan is a difficult task. We must also remember that after the tragedy of Sept. 11, 2001, it is also a necessary one.”</p></blockquote>
<p>Can someone please tell me what &#8220;winning the war on terror&#8221; would look like?  I mean really, how would we know?  Who would keep score? How would we verify? How would we enforce it? For how long would the win have to be won for it to be regarded as a real win? This isn&#8217;t meant to be an exercise in rhetoric, but really, words do matter.</p>
<p>The same line of inquiry applies to the concept of &#8220;success.&#8221;  For example, we have successfully burned through nearly $300 billion dollars and 1,000 American war dead.  If that was the objective, and clearly it was not, we succeeded.  Can we go home now?</p>
<p>And &#8220;necessary?&#8221;  Really?  How necessary?  Necessary enough to consider genocide?  That would do the trick.  There would be no more Afghans and by definition, none could engage in terrorist-like activities.</p>
<p>I get it, I get it.  This is political-talk, not decision-talk.  Mr. Steele is in the business of raising money from the faithful and scoring political points, not actually governing or solving real problems. Given the low standards of the job description he can be forgiven for his less that helpful words and thoughts about the trillion dollar black hole that is our foray into Central Asia. As a matter of public policy it would be nice if someone could offer we the people a problem definition that was useful, understandable, and achievable.  Not that I think anyone in Washington is in danger of doing that.</p>
<p>On a smaller scale, think about how you frame the decisions you make on a daily basis. Pay particular attention to the big ones.  Make sure you&#8217;re not declaring the equivalent of war on [fill in the blank].  You&#8217;ll never get there.</p>
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		<title>The Madness of Afghanistan and a Little Trick I Call Math</title>
		<link>http://kevinhoffberg.com/blog/2010/07/01/the-madness-of-afghanistan-and-a-little-trick-i-call-math/</link>
		<comments>http://kevinhoffberg.com/blog/2010/07/01/the-madness-of-afghanistan-and-a-little-trick-i-call-math/#comments</comments>
		<pubDate>Thu, 01 Jul 2010 20:19:16 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Current Affairs]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Afghanistan]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Iraq]]></category>
		<category><![CDATA[Petraeus]]></category>
		<category><![CDATA[war on terror]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=797</guid>
		<description><![CDATA[For the past decade I have made a living helping people and corporations make smarter decisions.  I say that by way of disclosing my bias when I think about nearly everything.  Yesterday I blogged about General Petraeus&#8217; testimony before the Armed Services Committee in advance of his taking over as the overlord of the &#8220;not [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>For the past decade I have made a living helping people and corporations make smarter decisions.  I say that by way of disclosing my bias when I think about nearly everything.  Yesterday I blogged about <a href="http://kevinhoffberg.com/blog/2010/06/30/what-i-wish-david-petraeus-said/">General Petraeus&#8217; testimony before the Armed Services Committee</a> in advance of his taking over as the overlord of the &#8220;not war&#8221; in Afghanistan.  You should read it.  It is a marvel of circumlocution.</p>
<p>Good decision making begins with an exam question: The entire rationale for making a decision in the first place; a statement of the problem we&#8217;re trying to solve. Use your favorite search engine and see if you can figure out the answer to the question of why we&#8217;re in Afghanistan. I figure the <a href="http://abcnews.go.com/Politics/State_of_the_Union/state-of-the-union-2010-president-obama-speech-transcript/story?id=9678572&amp;page=4">President&#8217;s own words from his State of the Union</a> are as good as any . . .</p>
<blockquote><p>As we take the fight to al Qaeda, we are responsibly leaving Iraq to its people. As a candidate, I promised that I would end this war, and that is what I am doing as President. We will have all of our combat troops out of Iraq by the end of this August. We will support the Iraqi government as they hold elections, and continue to partner with the Iraqi people to promote regional peace and prosperity. But make no mistake: this war is ending, and all of our troops are coming home.</p></blockquote>
<p>So basically the point is to &#8220;take the fight to al Qaeda&#8221; or more broadly to &#8220;fight terror over there so we don&#8217;t have to fight it here&#8221; or something like that.  I&#8217;m sure that there are more precise thoughts than that but basically that&#8217;s the mission the American people have been sold for the past eight years by two different administrations.</p>
<p>There are lots of ways to think about this, so let&#8217;s pick one: The Math</p>
<p>From the <a href="http://www.state.gov/r/pa/ei/bgn/5380.htm">State Department, here&#8217;s what we know about Afghanistan</a>:</p>
<p style="padding-left: 30px;">Area: 652,230 sq. km. (251,827 sq. mi.); slightly smaller than Texas.</p>
<p style="padding-left: 30px;">Population (July 2009 est.): 28.396 million; slightly smaller than Texas.</p>
<p style="padding-left: 30px;">GDP (2009 est., purchasing power parity): $23.35 billion.</p>
<p style="padding-left: 30px;">GDP growth (2009 est.): 3.4%. GDP growth average between 2004-2009: 11.25% (est.).</p>
<p style="padding-left: 30px;">GDP per capita (2009 est.): $800.</p>
<p>Keep in mind that GDP has been inflated by the US presence since we tossed the Taliban.</p>
<p>So how much have we spent to date on the &#8220;not war&#8221; in Afghanistan.  That&#8217;s a moving target, but here are some numbers that might help you understand. According to the site, <a href="http://">Cost of War</a>, the number to date (depending on when you read this) is $280 billion dollars. Add in the cost of the Iraq &#8220;not war&#8221; and we the people have spent about $1 trillion dollars &#8220;taking the fight to al Qaeda.&#8221;  To get a sense of some alternative uses of $1 trillion dollars, spend some time on the Cost of War site.</p>
<p>Keep in mind that these numbers don&#8217;t include the costs associated with the Obama surge of an additional 30,000 troops.  So what do those cost? One source I found put the figure in 2008 at <a href="http://www.alternet.org/world/102187/the_stunning_costs_of_keeping_a_soldier's_%22boots_on_the_ground%22_in_iraq/">$500,000 per year</a>.  A more recent source puts the figure <a href="http://thehill.com/blogs/blog-briefing-room/news/63121-crs-calculates-cost-of-us-troop-presence-in-afghanistan">much higher</a>.</p>
<blockquote><p>The cost of sending one U.S. soldier in Afghanistan for one year is $1 million versus an estimated $12,000 for an Afghani soldier, according to Steve Daggett, a specialist with the Congressional Research Service. Those numbers fall within the calculations that the Obama administration has been using. The Obama administration is calculating $1 billion per 1,000 troops deployed to Afghanistan.</p></blockquote>
<p>To put the cost of the surge in a different light, US tax payers will spend the entire GDP of Afghanistan to send 30,000 troops there to achieve what?</p>
<p>And how much does it cost the Taliban / Al Queda to fight back? It&#8217;s hard to put a number on that but a simple metric might be the cost of an AK-47.  It turns out that fighting Americans is a growth business.  A few years ago you could get a locally made knock-off for the equivalent of a few hundred dollars . . . so half a year&#8217;s pay.  Today, <a href="http://www.google.com/hostednews/afp/article/ALeqM5jdHnagloGy-t5QRRc5NlT4hmCcxw">the price in Pakistan has bloomed to nearly $1,500</a>. Throw in some ammunition and a year&#8217;s pay and call it $3,000 per annum, half that if you assume the person holding the gun is a variable cost.</p>
<p><strong>This is the time when you need to stop and think about the mission and the math: $1 million vs. $3,000.  One bullet kills either one.</strong></p>
<p>We have been in Afghanistan eight years.  Every year, on average, we spend the entire GDP of Afghanistan chasing after a couple of thousand bad guys that can be equipped and paid for less than one of our soldiers.</p>
<p>The war is unwinable for three reasons, all math related.</p>
<ol>
<li>It only takes one bad guy to do the thing we have spent $1 trillion dollars to prevent: commit a terrorist act on the homeland.  Call it 100.</li>
<li>The other side can replace them faster and cheaper than we can kill them.</li>
<li>We&#8217;re going broke.  The other side can wait.</li>
</ol>
<p>The problem here is the problem statement. It&#8217;s like the war on drugs.  &#8221;Taking the fight&#8221; to the bad guys never ends.  There is no end zone. There is no way of knowing that you&#8217;re winning.  More importantly, the cost of the other side to stay in the game is orders of magnitude lower than what we spend. The other side ALWAYS WINS for the simple reason that all they have to do is stay in the game.  Eventually the high cost player is bled dry. The only way out is to change the question.</p>
<p>Finally, a reminder.  The people voting to keep us in this mess work for us.  You voted for them (or failed to). It&#8217;s time to speak up.  It&#8217;s time to stop the madness.</p>
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		<title>It&#8217;s the Unknown Unknowns that Really Get You</title>
		<link>http://kevinhoffberg.com/blog/2010/06/21/its-the-unknown-unknowns-that-really-get-you/</link>
		<comments>http://kevinhoffberg.com/blog/2010/06/21/its-the-unknown-unknowns-that-really-get-you/#comments</comments>
		<pubDate>Mon, 21 Jun 2010 07:59:08 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Unknown Unknowns]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=787</guid>
		<description><![CDATA[A wonderful article/interview in the New York Times with David Dunning, one of the rock stars of decision-making . . . you get to be called that, at least by me, if you have an entire principle named after you (Dunning-Kruger Effect).  Donald Rumsfeld said it best but we were too stunned to hear him . [...]]]></description>
			<content:encoded><![CDATA[<p></p><div>
<p><a href="http://opinionator.blogs.nytimes.com/2010/06/20/the-anosognosics-dilemma-1/">A wonderful article/interview in the New York Times with David Dunning</a>, one of the rock stars of decision-making . . . you get to be called that, at least by me, if you have an entire principle named after you (Dunning-Kruger Effect).  Donald Rumsfeld said it best but we were too stunned to hear him . . .</p>
<blockquote><p>“There are things we know we know about terrorism.  There are things we know we don’t know.  And there are things that are unknown unknowns.  We don’t know that we don’t know.”</p></blockquote>
<p>Here&#8217;s a snip from the interview.  Well worth reading the entire thing.  Apparently there are four more parts to come.</p>
<blockquote><p>Dunning and Kruger argued in their paper, “When people are incompetent in the strategies they adopt to achieve success and satisfaction, they suffer a dual burden: Not only do they reach erroneous conclusions and make unfortunate choices, but their incompetence robs them of the ability to realize it.  Instead, like Mr. Wheeler, they are left with the erroneous impression they are doing just fine.”</p>
<p>It became known as the Dunning-Kruger Effect — our incompetence masks our ability to recognize our incompetence.  But just how prevalent is this effect?  In search of more details, I called David Dunning at his offices at Cornell:</p>
<p><strong>DAVID DUNNING:</strong> Well, my specialty is decision-making.  How well do people make the decisions they have to make in life?  And I became very interested in judgments about the self, simply because, well, people tend to say things, whether it be in everyday life or in the lab, that just couldn’t possibly be true.  And I became fascinated with that.  Not just that people said these positive things about themselves, but they really, really believed them.  Which led to my observation: if you’re incompetent, you can’t know you’re incompetent.</p>
<p><strong>ERROL MORRIS:</strong> Why not?</p>
<p><strong>DAVID DUNNING:</strong> If you knew it, you’d say, “Wait a minute.  The decision I just made does not make much sense.  I had better go and get some independent advice.”   But when you’re incompetent, the skills you need to produce a right answer are exactly the skills you need to recognize what a right answer is.  In logical reasoning, in parenting, in management, problem solving, the skills you use to produce the right answer are exactly the same skills you use to evaluate the answer.  And so we went on to see if this could possibly be true in many other areas.  And to our astonishment, it was very, very true.</p>
<p><strong>ERROL MORRIS:</strong> Many other areas?</p>
<p><strong>DAVID DUNNING:</strong> If you look at our 1999 article, we measured skills where we had the right answers.  Grammar, logic.  And our test-subjects were all college students doing college student-type things.  Presumably, they also should know whether or not they’re getting the right answers.  And yet, we had these students who were doing badly in grammar, who didn’t know they were doing badly in grammar.  We believed that they should know they were doing badly, and when they didn’t, that really surprised us.</p>
<p><strong>ERROL MORRIS:</strong> The students that were unaware they were doing badly — in what sense?  Were they truly oblivious? Were they self-deceived?  Were they in denial?  How would you describe it?</p>
<p><strong>DAVID DUNNING:</strong> There have been many psychological studies that tell us what we see and what we hear is shaped by our preferences, our wishes, our fears, our desires and so forth.  We literally see the world the way we want to see it.  But the Dunning-Kruger effect suggests that there is a problem beyond that.  Even if you are just the most honest, impartial person that you could be, you would still have a problem — namely, when your knowledge or expertise is imperfect, you really don’t know it.  Left to your own devices, you just don’t know it.   We’re not very good at knowing what we don’t know.</p></blockquote>
</div>
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		<title>And Suddenly We Bought A Car</title>
		<link>http://kevinhoffberg.com/blog/2010/05/17/and-suddenly-we-bought-a-car/</link>
		<comments>http://kevinhoffberg.com/blog/2010/05/17/and-suddenly-we-bought-a-car/#comments</comments>
		<pubDate>Mon, 17 May 2010 20:45:38 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Business]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Random Walk]]></category>
		<category><![CDATA[Audi]]></category>
		<category><![CDATA[Branded Customer Experience]]></category>
		<category><![CDATA[Car and Driver Top 10]]></category>
		<category><![CDATA[Car Review]]></category>
		<category><![CDATA[G37]]></category>
		<category><![CDATA[Infiniti]]></category>
		<category><![CDATA[Kirkland Infiniti]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=764</guid>
		<description><![CDATA[So my wife and I were driving from point A to point B last Saturday.  Just a regular day running errands and spending time with each other. Honest to God, no kidding, I have not been thinking at all about getting a new car . . . though I have to confess that I never [...]]]></description>
			<content:encoded><![CDATA[<p></p><p style="text-align: center;"><img class="aligncenter" title="G37x" src="http://sphotos.ak.fbcdn.net/hphotos-ak-ash1/hs347.ash1/29519_424879862782_728612782_5529184_657316_n.jpg" alt="" width="362" height="272" /></p>
<p>So my wife and I were driving from point A to point B last Saturday.  Just a regular day running errands and spending time with each other.</p>
<p>Honest to God, no kidding, I have not been thinking at all about getting a new car . . . though I have to confess that I never loved the Camry Hybrid we have been driving and always felt like I made a mistake selling the Acura TL.  Anyway, I say to my wife, &#8220;Do you ever think about getting a new car?&#8221;  Gloriosity, she has!</p>
<p>There is an Audi dealer about five blocks from where we are so we go and poke around and drive an A5 coupe. Stunning to look at and very nice but pricey given the performance level.  The one with all the goodies costs as much as a small town. There aren&#8217;t any used ones.</p>
<p>Very much out of character, we leave without buying one (as it turns out, this is the third time in the past ten years that we went to look at an Audi and bought something else which is weird and too bad because I really like Audis and would very much like to be like <a href="http://en.wikipedia.org/wiki/Jason_Statham">Jason Stratham</a>).  Instead, we wind up home looking at everything we can think of on the web.</p>
<p>It turns out we actually have some decision criteria . . .</p>
<ul>
<li><strong>Coupe</strong>: We think that means two doors and an emphatic statement that we are now a) Empty nesters for sure, and b) Too cool for school.</li>
<li><strong>All wheel drive</strong>: Well you never know, it might rain in Seattle, and it is always possible that after a 30 year hiatus, we might just decide to head to the snow and do some skiing. It could happen.</li>
<li><strong>High fun factor</strong>: Antithesis of the Camry Hybrid.</li>
<li><strong>Good economics</strong>: We don&#8217;t need to do this so there needs to be something compelling (like free money).</li>
<li><strong>Good story value</strong>: If there isn&#8217;t a good story in here, what&#8217;s the point?</li>
</ul>
<p>Basically something more fun that a four door hybrid (a very low bar to step over I might add).</p>
<p>There aren&#8217;t that many coupes out there at all if you think about it.</p>
<p style="padding-left: 30px;"><a href="http://www.audiusa.com/us/brand/en/models/a5_models.html">Audi A5</a><br />
<a href="http://www.infinitiusa.com/g_coupe/"> Infinity G37</a><br />
<a href="http://www.hyundaigenesis.com/coupe/"> Hyundai Genesis</a><br />
<a href="http://www.jaguar.com/us/en/#/xk/?campaignid=L0000726"> Jaguar XK</a><br />
<a href="http://www.astonmartin.com/thecars"> Aston Martin</a><br />
<a href="http://www.bmwusa.com/standard/content/vehicles/2010/6/default.aspx"> BMW 3 or 6 series</a><br />
<a href="http://www.mbusa.com/mercedes/#/exploreOverview/?vmf=CL550C4&amp;vc=CL&amp;yr=2010"> Mercedes CL</a><br />
<a href="http://www.fordvehicles.com/cars/mustang/"> Ford Mustang</a><br />
<a href="http://www.chevrolet.com/vehicles/2010/camaro/overview.do"> Chevrolet Camaro</a><br />
<a href="http://www.dodge.com/en/2010/challenger/"> Dodge Challenger</a><br />
<a href="http://www.cadillac.com/concept-cars/"> Cadillac CTS</a> (coming soon)</p>
<p>There are probably some others (Bently comes to mind) and there are some four door coupes as well (we&#8217;ll get to that in a minute), but that&#8217;s what we looked at on our dueling iPads.</p>
<p>A bunch of those you can just cross right off the list for cost reasons. This is a car, after all, not a vacation home. The Ford, Dodge, and Chevrolet never made the list.  Too retro, too boy racer, too much. I didn&#8217;t want another Corvette or anything in that category either.  Cars like that are a hoot to drive three or four times a month for several miles without a break.  We also looked at other AWD cars not in two doors, kind of. Never for a second did we think about a SUV.</p>
<p>Basically it was looking like a two horse race between the A5 and the G37x.</p>
<p>There are almost as many Infinity dealers in the US as there are BMW motorbike dealers and they are slightly less convenient.  We motored up to the one in <a href="http://www.infinitiofkirkland.com/">Kirkland</a> and low and behold they had a nice collection of G37x&#8217;s right out front.  Very nice car it is.</p>
<p>For those not in the know it is a two door coupe with a stupidly powerful V6 engine, all wheel drive, and enough computing power and navigational gear to launch a first strike.  I think there is a Predator Drone option as well. Various buff books have called it <a href="http://www.caranddriver.com/features/09q1/2009_10best_cars-10best_cars/2009_infiniti_g37_page_7">the best this</a> and the most that.  It&#8217;s a fine, fine ride. In a pinch you can put your pet gerbils in the back assuming your luggage needs don&#8217;t exceed a laptop, credit card, and toothbrush.</p>
<p>We drove one.  We looked at all of them in detail. I really wanted to love it but I didn&#8217;t.  Not really sure why.  Just like I really wanted to love the A5 (a beautiful car with abusively priced options).  In the end, the dream of the racy coupe with two gigantic hard-to-egress doors and go-fast ergonomics got trumped by my creaking bones and sybaritic tendencies.</p>
<p>Meanwhile, I kept looking over at the <a href="http://www.infinitiusa.com/g_sedan/">G37 sedans</a> . . . essentially the same car with two more doors, lots more headroom, and the possibility of transporting two more bipeds in relative comfort.  By this time my wife was talking with the sales guy about a Coupe with a particular interior color she fancied and I finally suggested that we go over to the sedans because they had a couple just like that.</p>
<p>For about the fifth time, one in the lineup kept whispering to me: A  G37x  in Lakeshore Slate with Stone interior, all wheel drive, Navigation package, and upgraded wheels and tires that come up to my waist.  Our sainted car salesman (Ken, who just this week sold his 1000 Infiniti working at this dealer which is something indeed) tossed us yet another set of keys and off we went.  We barely made it out of the lot and kind of looked at each other and it was done.  The car had us at 2500 rpm.</p>
<p>Being a well known expert at <a href="http://decision-quality.com/">decision-making</a> I would give this about a six on a scale of one &#8211; 10.  We had a decently clear idea about our preferences. We had a solid frame on the problem.  We gave ourselves interesting choices. We did some research. The fact that we changed one of the major preferences at the last minute (expanding coupe to include the four door variety) brought other cars into play that we didn&#8217;t then go test drive, but what the hell. Ken made us an offer that was not insulting (remember we&#8217;re trading in a Camry Hybrid, the 2010 Torts Award Silver Medalist, tossed from the top step by British Petroleum).  Robert, the F&amp;I guy made us a smoking deal on stuff to keep the paint and interior spiffy and then papered the whole thing in about twelve minutes. Bye-bye Camry, and hello rocket ship.</p>
<p>One day of ownership later, I can say with complete confidence the following:</p>
<p style="padding-left: 30px;">The people at Kirkland Infinity were just superb, led by Ken.  It&#8217;s all part of the brand, but the difference in customer experience shopping for a luxury car and anything else is stunning.  Ken has been at this same dealer for eight years which is even more remarkable than the thought of Sarah Palin shooting a moose.  This sort of thing just doesn&#8217;t happen.</p>
<p style="padding-left: 30px;">Ken, and people not named Ken, continually make an effort to a) communicate that &#8220;you&#8217;re family now&#8221; (in a really good way), and b) are constantly trying to figure out how to do something helpful. I was only sorry I hadn&#8217;t brought our laundry to be done.  I know I&#8217;m going to get a survey but let me cut to the chase and say that the folks at Kirkland Infinity get a 10.</p>
<p style="padding-left: 30px;">Infiniti has ridiculously cheap money these days (there was a free option actually).  It&#8217;s like I couldn&#8217;t afford not to.</p>
<p style="padding-left: 30px;">The car is all kinds of fun to look at, sit in, and drive.  I. Must. Drive. Slow.</p>
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		<title>Innovation Never Goes Out of Style</title>
		<link>http://kevinhoffberg.com/blog/2010/05/03/innovation-never-goes-out-of-style/</link>
		<comments>http://kevinhoffberg.com/blog/2010/05/03/innovation-never-goes-out-of-style/#comments</comments>
		<pubDate>Mon, 03 May 2010 17:04:02 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Business]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[dot.com]]></category>
		<category><![CDATA[innovation]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=761</guid>
		<description><![CDATA[I get emails every week at www.decision-quality.com asking for permission to reprint, quote, and distribute one or more papers I wrote on decision-making.  It&#8217;s been forever since I actually looked at what I wrote so I went back and looked.  Here&#8217;s a snip from a paper on innovation I wrote.  The words seem useful even [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>I get emails every week at <a href="http://www.decision-quality.com/">www.decision-quality.com</a> asking for permission to reprint, quote, and distribute one or more papers I wrote on decision-making.  It&#8217;s been forever since I actually looked at what I wrote so I went back and looked.  Here&#8217;s a snip from a <a href="http://www.decision-quality.com/downloads.php">paper on innovation</a> I wrote.  The words seem useful even today . . .</p>
<p>Having participated in the tail end of it as a go-to-market consultant to a number of incubator companies, I had a ringside seat to both the good and the really ugly of the dot.com excitement. At literally the height of the boom, days before the wall started coming down, I wrote a kind of innovator’s credo that I called the disruptor’s dilemma, which had the following dimensions.</p>
<p style="padding-left: 30px;"><strong>Nothing is Known</strong>. If it really hasn’t been done before, there are few if any known market requirements, and therefore your planning and projections are pretty much guesswork.</p>
<p style="padding-left: 30px;"><strong>What Used To Work, Won’t</strong>.  The strategies and tactics that worked so well in the value system you just left probably won’t work in the market space you’re about to enter.</p>
<p style="padding-left: 30px;"><strong>Half of What You Decide Is Wrong</strong>.  As a result of the first two points, you have to make the assumption that at least half of the decisions you make are probably wrong.</p>
<p style="padding-left: 30px;"><strong>Half Of What You Learn Is Right</strong>.  You’ll spend every waking minute on a massive learning curve, and the feedback you’ll receive will usually be completely contradictory.  You should worry if that’s not the case.  The question is: where is the truth?</p>
<p style="padding-left: 30px;"><strong>All Of What’s Right Is Only Useful For Half As Long As It Used To Be</strong>.  Just because something is true, doesn’t mean it will continue to be true.</p>
<p style="padding-left: 30px;"><strong>Success Is Out There, It’s Just Somewhere Else</strong>.  If you keep learning, adapting, and innovating you might just succeed.  It’s just that success probably won’t lie where you thought it would.</p>
<p>Depending on your point of view, this is either a recitation of the worst of the dot.com hyperbole, or it is a reasonable set of guidelines for nurturing innovation. This led me to articulate what I then saw, and still see, as the “Six Laws of Successful Innovation,” which are as follows:</p>
<p style="padding-left: 30px;"><strong>Your plans won’t hold up so compress your planning</strong>.  Bring the right people to the problem; stress test your thinking, make clear decisions, keep your documentation simple, and launch decisively.</p>
<p style="padding-left: 30px;"><strong>Keep it simple</strong>. Complexity shows up all by itself.</p>
<p style="padding-left: 30px;"><strong>Once you launch, go fast and hard</strong>.  Compress your learning into small segments of time and space. Think in 100-day increments.</p>
<p style="padding-left: 30px;"><strong>Embrace your mistakes</strong>.  Mistakes are good because they tell you what not to do, so don’t cover them up. You’re probably going to make a bunch, so plan how you’re going to learn from your mistakes.</p>
<p style="padding-left: 30px;"><strong>Expect the unexpected</strong>. You’re going to whack some beehives in the process (particularly if you’re really innovating), and the bees are going to swarm.  Don’t expect the market to sit around and watch as you try to redefine reality. Expect pushback.  Expect to be counterattacked from unexpected directions. Expect partners to make silly decisions.  It should all tell you that you’re doing something right.</p>
<p style="padding-left: 30px;"><strong>You’re going to win in unexpected ways</strong> so build your organization, rewards structure, and partnership agreements accordingly.</p>
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		<title>Survival Comes in Threes</title>
		<link>http://kevinhoffberg.com/blog/2010/04/12/survival-comes-in-threes/</link>
		<comments>http://kevinhoffberg.com/blog/2010/04/12/survival-comes-in-threes/#comments</comments>
		<pubDate>Tue, 13 Apr 2010 03:39:46 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[3 rules]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=754</guid>
		<description><![CDATA[You cannot survive . . . 3 seconds without spirt and hope 3 minutes without air 3 hours without shelter in extreme conditions 3 days without water 3 weeks without food 3 months without companionship or love Roughly right and worth remembering.  Everything else takes care of itself.]]></description>
			<content:encoded><![CDATA[<p></p><p>You cannot survive . . .</p>
<p>3 seconds without spirt and hope</p>
<p>3 minutes without air</p>
<p>3 hours without shelter in extreme conditions</p>
<p>3 days without water</p>
<p>3 weeks without food</p>
<p>3 months without companionship or love</p>
<p>Roughly right and worth remembering.  Everything else takes care of itself.</p>
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		<title>Health Reform is Bad Except that it’s Good. Why and how we are Prisoners of Narrative</title>
		<link>http://kevinhoffberg.com/blog/2010/03/28/health-reform-is-bad-except-that-it%e2%80%99s-good-why-and-how-we-are-prisoners-of-narrative/</link>
		<comments>http://kevinhoffberg.com/blog/2010/03/28/health-reform-is-bad-except-that-it%e2%80%99s-good-why-and-how-we-are-prisoners-of-narrative/#comments</comments>
		<pubDate>Sun, 28 Mar 2010 21:23:37 +0000</pubDate>
		<dc:creator>kevin</dc:creator>
				<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Change How You Roll]]></category>
		<category><![CDATA[Decision Quality]]></category>
		<category><![CDATA[Health Reform]]></category>
		<category><![CDATA[mental models]]></category>
		<category><![CDATA[Narrative Thinking]]></category>

		<guid isPermaLink="false">http://kevinhoffberg.com/blog/?p=740</guid>
		<description><![CDATA[We love a good story. There are lots of reasons this is true. For example . . . We’re raised listening to stories, some read, some told. Most of the media we consume is narrative based. Culture is communicated, instilled, and passed along through stories. We use narrative as a mechanism for processing stimulus and [...]]]></description>
			<content:encoded><![CDATA[<p></p><p>We love a good story.  There are lots of reasons this is true.  For example . . .</p>
<ul>
<li>We’re raised listening to stories, some read, some told.</li>
<li>Most of the media we consume is narrative based.</li>
<li>Culture is communicated, instilled, and passed along through stories.</li>
<li>We use narrative as a mechanism for processing stimulus and memories into something we can use.</li>
</ul>
<p>We non-scientists know this later point to be true simply by observing our own internal dialogs.  For example, when we feel wronged by someone, what do we do?  We replay the story of the wronging over and over again in our heads.  And then what happens?  We change the dialog and the outcome of these stories as we imagine all the devastatingly clever things we should have said.</p>
<p>In the same way, when we think about the future we construct stories that encapsulate our hopes and fears.  Depending on the content of the stories we imagine, and the intensity with which we imagine them, we might call this activity daydreaming, visualizing, or obsessing.</p>
<p>This internal process of story telling doesn’t stop with a single drama. We tell the story over and over, changing bits and pieces as we go. And then we go further. We assemble the stories into a broader meta-story that becomes the narrative of our lives.  If a particular person has wronged us, we might resurrect other tales of being wronged in a similar way by other people. Or we might string together stories about other times that person did something to us we didn’t like. By doing this, we wrap stimulus, response, and specific memories together to create a narrative.</p>
<p>This act of linking stories together, either looking backwards or forwards, is a function of our wiring to use meaning and pattern making as a way of making sense of what goes on around us.  We order our memories and what we perceive to be facts into a pattern that makes sense, a narrative that has meaning.</p>
<p><span id="more-740"></span><br />
Again, we know this to be true when we examine our internal dialogs.  When we tell ourselves things like, “My brother was always smarter than me?” or “I make bad decisions under stress” or “I have always had great instincts about people” we are organizing a life of memories, stimulus and response into a narrative, backed by stories that support the meaning we choose.  We could just as easily find memories to support an alternative narrative.</p>
<p>Here’s a small and silly example. I can remember standing next to a building some years ago and realizing that a bird had just dumped a load on my shoulder from somewhere above me.  And what story did I tell myself? “Birds are always crapping on me.” I supported that conclusion by recalling several other instances I could recall when a bird had either crapped on my, my car, the furniture on my deck, even on other people.  So now I have a narrative, created out of stories I told myself, that supports a meaning and pattern I went looking for.</p>
<p>Does that last point sound harsh?  Then ask yourself this?  How many birds have flown over you in just in the last year, yet along the last ten, or in my case, 53 years?  You can’t count that high.</p>
<p>No, birds don’t always crap on you, me, or anyone. But you can see how easy it is to think such a thing when you realize that we are wired to think in narratives, stories linked to stories that support patterns and meaning on which we have already anchored.  That’s right.  We come to our story telling with the patterns and meaning already in place and interpret the stimulus and memories to fit.  It takes an act of will to change the relationship and observe our situation separate from our wiring to narrate.</p>
<p>We see examples of the power and danger of narratives all around us, most vividly when it comes to lightning rod issues like health care reform.  If you could go back in time a year ago and ask people about health care, you would most likely have heard personal narratives . . . points of view based on personally experienced stimulus and responses.</p>
<p>Twelve months later, there are “sides to the debate.” Health reform haters and supporters are now swept up in powerful narratives that are generally not rooted in personal experience. They come from someplace else.  Almost nobody has read the actual legislation, so we know that the meaning people find here is not rooted in analysis or something that passes for fact.  The meaning has begotten the narrative. People project their hopes and fears onto the narrative and thus become part of it.</p>
<p>There are good reasons for why this happens.  We have amazing cognitive abilities, gated by a relatively small capacity working memory. In a hugely over-stimulated existence, we survive by focusing on a few immediately important pieces of information, and rely on the wealth of pre-stored behavioral scripts, mental models, memories, pre-loaded patterns and meanings, and “proven” narratives to make sense of the rest.  We do this because most of the time the cost of doing so is low and the results we seem to experience are pleasing, or at least tolerable.</p>
<p>Over thousands of generations, we have evolved all manner of thinking tricks that have kept us out ahead of our competitors and circumstances.  Narrative thinking is a useful term for describing how we create, store, and retrieve memories in a complex world . . . a world by the way made complex by our stunning and ever evolving thinking skills.</p>
<p>You can use these wonderful story-telling skills to your advantage.  Two ideas come to mind.</p>
<p style="padding-left: 30px;">If you decide you want to make a change, the first place to start is to construct new narratives. Resurrect old stories into new combinations to support the new meaning you want to find and make.  In other words, when you change your “values” (a fancy word for what you want), actively change the stories you tell yourself about your past and about your future.  Change the meaning first, the narrative second, and the rest will follow.</p>
<p style="padding-left: 30px;">If you find yourself caught up in the passions of the hour, particularly the kind that seem to excite the imagination of lots of people, remind yourself that narratives are not the stories and the stories aren’t the “facts.” You and I can look at exactly the same set of facts or stimulus and find very different meanings.  Things are as they are.  They aren’t supposed to be one way or another.  We are the ones who assign meaning and pattern.  We make that choice.  We can make a different choice.</p>
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