Author Archives: Jon Lowder

Make Sure to Tell Your Ambulance Driver to Head to the High Rent Hospital

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From the Freakonomics blog:

Both strategies show that higher-cost hospitals have significantly lower one-year mortality rates compared to lower-cost hospitals. We find that common indicators of hospital quality, such as indicators for “appropriate care” for heart attacks, are generally not associated with better patient outcomes. On the other hand, we find that measures of “leading edge” hospitals, such as teaching hospitals and hospitals that quickly adopt the latest technologies, are associated with better outcomes, but have little impact on the estimated mortality-hospital cost relationship. We also find that hospital procedure intensity is a key determinant of the mortality-cost relationship, suggesting that treatment intensity, and not differences in quality reflected in prices, drives much of our findings. The evidence also suggests that there are diminishing returns to hospital spending and treatment intensity.

Basically what they're saying is that if you go to the budget hospital you're likely screwed.

If Stupid People Organized

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Scott Adams (the Dilbert dude) has a blog post where he asks a simple question – "What would happen if stupid people figured out how to organize their vast numbers into a cohesive political force?" – and then provides an example of people organizing around a stupid idea via change.org and points out that the organization is a tool for both good and bad:

I don't know if the good work that comes out of Change.org offsets the bad. In any case, I don't think free speech should be curtailed. My point is that Change.org is a tool that can empower both smart people and stupid people, and that only one of those situations is good. 

In my mind a big group of stupid people isn't all that scary because, well, they're stupid and as a result Darwin's Law will kick in sooner rather than later. At the other extreme an organized group of nutjobs, zealots and evil people scares the crap out of me for obvious reasons. But what really scares me are the kinda smart people in the middle – the folks who are smart enough to get things done, but not smart enough to realize they're tools – who enable one really talented nutjob to do bad things on a massive scale. 

On Writing

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Letters of Note is fast becoming one of my favorite daily reads. Today's letter, written by C.S. Lewis to a young reader, offers wonderful and practical advice on writing. If you replace the word "writing" with "communicating" I think it offers perfect advice to all of us for our daily lives:

What really matters is:– 

1. Always try to use the language so as to make quite clear what you mean and make sure your sentence couldn't mean anything else.

2. Always prefer the plain direct word to the long, vague one. Don'timplement promises, but keep them.

3. Never use abstract nouns when concrete ones will do. If you mean "More people died" don't say "Mortality rose."

4. In writing. Don't use adjectives which merely tell us how you want us to feel about the thing you are describing. I mean, instead of telling us a thing was "terrible," describe it so that we'll be terrified. Don't say it was "delightful"; make us say "delightful" when we've read the description. You see, all those words (horrifying, wonderful, hideous, exquisite) are only like saying to your readers, "Please will you do my job for me."

5. Don't use words too big for the subject. Don't say "infinitely" when you mean "very"; otherwise you'll have no word left when you want to talk about something really infinite.

Unintended Consequences

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Most of us are familiar with the law of unintended consequences (for those of you who aren't, prohibition would be a good place to start your research) and this post at Tax.com has me wondering if all those folks fighting Obamacare in the courts might have considered the unintended consequences if they win:

The only difference between the mandate and your common tax incentive is that Congress framed the incentive as a tax penalty instead of a tax break. I recognize there might be a legal difference between the two approaches that is beyond my comprehension. But the Court, Congress, and the public should understand that economically the two approaches are exactly the same…

A tax penalty and a tax incentive have the same economic impact on affected and unaffected individuals. They have the same effect on the goals the government is trying to achieve. They have the same effect on government revenues. It is possible, then, that they have the same effect on freedom and constitutional principles.

So armchair constitutional scholars should enjoy the show. But please excuse us economists if we tune out. Perhaps too blithely, we assume the mandate will be affirmed because the nation's leading legal gurus won't want to open up a can of worms that makes all tax incentives subject to constitutional challenge. If by chance the court does strike down the mandate, by all means give us a call. It could be the beginning of the end for all those complex and inefficient tax incentives we have been complaining about all these years.

So a question for you legal scholars out there: if the Supreme Court strikes down Obamacare is my wonderful deduction for mortgage interest soon to follow?

Fart Psych

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Starting with a question – Why do people feel less of a need to fart when they're in public? (I'm paraphrasing a bit) – this writer tracks down the only study he can find on the psychology of farts. He then interviews the genius who conducted the study and is a bit disappointed to discover that no real farts were involved:

The basic question behind this paper is: how does a fart in social context affect a person's views of the farter? In order to study this, Lippman took a bunch of college students, and gave them a series of hypothetical situations in which someone farted. He asked them to rate their opinions of that person.

It's really sad to me that the situations were all hypothetical. This was part of Dr. Lippman's caricature of many social psychology studies being performed at the time, which tended to rely on pen and paper rankings while college students considered hypothetical situations. While it makes for a good caricature, I'm sad to know that my idealized vision of little knots of people with someone letting loose a silent'n'deadly never actually happened. And really, you have to think this would be a hard thing to plan. After all, how many people do you know can release a silent, deadly fart ON COMMAND?

So Lippman had students fill out surveys. In another poke at social psychology (which often involves 3 factorial designs), this one involved a FIVE-dimensional design. Just to go over the top. The variables were the following:

1) Whether you were in a group of strangers or a group of acquaintances.
2) Whether the fart was loud or silent.
3) Whether the fart was scentless or rank (the word used was in fact "rank").
4) Whether the fart was deliberate.
5) Whether the person taking the questionnaire and hypothetically "experiencing" the fart (the fart-ee?) was male or female.

The rest of the read is equally enlightening.

The Silver Lining in My “I’ll Never Be Able to Retire” Cloud

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As someone who's never made a ton of money, has been self-employed for much of my career, has not been real good about setting aside funds for retirement and is of the generation that will suffer first when the Boomers bankrupt the Social Security and Medicare systems, I long ago reconciled myself to the idea that I'll probably never be able to retire. That sounds like a bummer, but since I don't play golf I don't think it's that big of a deal. And there's this positive aspect of not retiring – I'll probably live longer:

We find that a reduction in the retirement age causes a significant increase in the risk of premature death – defined as death before age 67 – for males but not for females. The effect for males is not only statistically significant but also quantitatively important. According to our estimates, one additional year of early retirement causes an increase in the risk of premature death of 2.4 percentage points (a relative increase of about 13.4%; or 1.8 months in terms of years of life lost)…

The authors trace the effect to negative behavioral changes associated with early retirement and conclude that “32.4% of the causal retirement effect can be directly attributed to smoking and excessive alcohol consumption.”

Xbox Not Just for Gamers

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Two Christmases ago our big family gift was Xbox Kinect. Normally with a gift like that I'd put family in quotes because we'd all have known that it was really a gift for the kids, but in this case it was a true family gift that's used more by the kids than the parents. Why's that? Because while the kids (our youngest son in particular) use the Xbox as it was originally intended – to play video games – the rest of us use it as an entertainment center. Apparently we aren't the only ones:

As promised, Xbox has rolled out three big content partners, beefing up its role as a big television player in the living room. Starting today, HBO Go (for participating providers), Xfinity and MLB (for subscribers) are debuting on Xbox Live, adding to Netflix, Hulu, ESPN and many more. And marking today’s announcement, Xbox said more people are now using the console for entertainment purposes (TV, movies and music) than gaming. (Emphasis mine)…

As we’ve written several times before, Xbox is television’s largest social network. While these new apps don’t take advantage of many Xbox Live features, the obvious next evolution is to become more social, engaging and connecting subscribers over voice, video and data. The foundation is built, and the scale is there (Xbox sold 426,000 units in February alone). And now it’s just up to developers to evolve a consumption experience to a social experience, tapping the Xbox Live wiring to make it happen. Stay tuned…

It's been obvious for a while that the wall between most households' primary entertainment vehicle (television) and primary information vehicle (computer tied to internet) has been crumbling, but it's fascinating to see how it's happening. In retrospect it makes total sense that the video game console would become the vehicle, but we've been witness to far too many failed "WebTV-ish" experiments to say that it was obvious to many people beforehand.

Why Business Blogs are Still Relevant

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I've had the opportunity to sit through my fair share of presentations on social media and how it could/should be integrated into companies' communications mix. Over the last year I've heard a disturbing number of people say they've nixed their blogs, and sometimes whole websites, and concentrated solely on their Facebook presence. What's the disturbing number? At least one and that's one too many.

If I were to delve into all the reasons why this is a bad idea I'd be writing a 10,000 word treatise, so let me just point to one reason I think blogs still have a place in every company's communication toolbox. It's a case study from right here in the Piedmont Triad as related by Matt Evans at the Triad Business Journal:

Kestler recently took a trip to visit some of those suppliers, and posted a photo of his trip on the company's Facebook page.

Then came the invective – the company’s page was inundated with ugly and obscene comments that questioned Kestler's patriotism. The photo had to be removed from the Facebook page.

But Kestler didn’t want to leave it at that, and composed a blog post responding to the comments. In it, he traces his family roots back to the Revolutionary War and talks about his company’s history of paying above-average wages and providing good benefits to workers.

To me this case highlights the best that blogs have to offer – they're a great way to have a "conversation" with customers that's more than one or two sentences (or 140 characters) in the comments field of an almost ethereal digital environment (Facebook). With a blog you can provide the kind of context that doesn't work well on Facebook, and more importantly you own it so you can make sure that what you write appears as you want it to. Even better you can invite comments from your customers and retain the ability to review them before they go live on your site – this helps you keep the invective down and prevent the conversation from spiraling out of control. Does this mean you prevent all negative comments from appearing? Absolutely not! Rather, you simply prevent name calling or pointless diatribes from hijacking the conversation. Good luck pulling that off on Facebook.  

Sure Facebook's an important place to be these days, but it's far from the only game in town, or from being the most important for your business.