A Bet is a Tax on Bullshit

[jimmy olsen]

I agree, what say you?


http://marginalrevolution.com/marginalrevolution/2012/11/a-bet-is-a-tax-on-bullshit.html

A Bet is a Tax on Bullshit

by Alex Tabarrok on November 2, 2012 at 7:35 am in Current Affairs, Data Source, Economics, Political Science | Permalink

Nate Silver, whose models give Obama a high probability of winning reelection, has offered one of his critics a bet. "Putting your money where your mouth is," is a time-honored principle of integrity in my view but the NYTimes Public Editor is very upset. Margaret Sullivan, however, never offers an argument against betting instead treating it as unseemly.

    [Betting is] inappropriate for a Times journalist, which is how Mr. Silver is seen by the public even though he's not a regular staff member.

    "I wouldn't want to see it become newsroom practice," said the associate managing editor for standards, Philip B. Corbett. He described Mr. Silver's status as a blogger — something like a columnist — as a mitigating factor...

    ...When he came to work at The Times, Mr. Silver gained a lot more visibility and the credibility associated with a prominent institution. But he lost something, too: the right to act like a free agent with responsibilities to nobody's standards but his own.

The closest to an argument against betting is this:

    ...whatever the motivation behind it, the wager offer is a bad idea – giving ammunition to the critics who want to paint Mr. Silver as a partisan who is trying to sway the outcome.

My best parse of the argument is that by betting Silver has given himself an interest in the election and this hurts his credibility. Nothing, however, could be further from the truth.

A properly structured bet is the most credible guarantor of rigorous disinterest. In order to prove his point, Silver is not required to take the Obama side of the bet! At the odds implied by his model (currently between 3 and 4 to 1) Silver should be willing to take either side of a modest bet. Indeed, we could hold a coin toss, heads Silver takes the Obama side, tails he takes Romney.

In fact, the NYTimes should require that Silver, and other pundits, bet their beliefs. Furthermore, to remove any possibility of manipulation, the NYTimes should escrow a portion of Silver's salary in a blind trust bet. In other words, the NYTimes should bet a portion of Silver's salary, at the odds implied by Silver's model, randomly choosing which side of the bet to take, only revealing to Silver the bet and its outcome after the election is over. A blind trust bet creates incentives for Silver to be disinterested in the outcome but very interested in the accuracy of the forecast.

Overall, I am for betting because I am against bullshit. Bullshit is polluting our discourse and drowning the facts. A bet costs the bullshitter more than the non-bullshitter so the willingness to bet signals honest belief. A bet is a tax on bullshit; and it is a just tax, tribute paid by the bullshitters to those with genuine knowledge.

[CountDeMoney]

Stupid.  Enough with the Silver Hate already.  It's probability, not prediction.

[Sheilbh]

It was a disgrace.  I've never read anything more schoolmarmish than that 'Public Editor' piece - and I read Enid Blyton as a kid.  The 'Gray Lady' seems a very appropriate nickname.

[Sheilbh]

Also, 'betting is inappropriate for a Times journalist'?

Christ, and they wonder why they're failing.

[Ed Anger]

Stupid.  Enough with the Silver Hate already.  It's probability, not prediction.

No. He is whiny homo.

[CountDeMoney]

You just don't like him because he's thinner than you.

[Ed Anger]

You just don't like him because he's thinner than you.

Dear god, he is just a line then.

[Ideologue]

And speaking of, where the hell is Yi?

[MadImmortalMan]

Silver's views were already known. The Times is full of crap that he lost anything here. Bet to your heart's content, Nate.

[Razgovory]

I think he's right.  Talking heads wouldn't spout so much bullshit if they actually had some sort of consequence for saying it.  There was a whole bunch of Republican pundits 4 years ago talking about a McCain victory, even a landslide.  They knew it wasn't true (or if they didn't they were truly crazy).  It was just bullshit.