Miscellany: 9/01/12

Quote of the Day 
Joy is prayer
Joy is strength
Joy is love
Joy is a net of love by which you can catch souls.
Mother Teresa

Bad Statistics

The reason economists have trouble with the idea of rampant pay discrimination is that it defies common sense. Let's say I own a company and I am employing only men. Is it really true that I could fire all the men, replace them with women and lower my cost of labor by 23%? If I could do that why wouldn't I? If I were stupid enough not to do it, wouldn't a competitor of mine do it and drive me out of business? - John Goodman

HT to Mark Perry for grabbing the quote and triggering a predictable debate on his blog. Any competent researcher knows the feminist policy on this issue is based on ideology and superficial statistics. (Keep in mind money is fungible, so you have to look at total compensation (including benefits), not just salary--plus, you have various supply/demand issues, marital status, various background and experience factors, quality of life issues (e.g., road warrior), etc. (You can have situations where males dominate in a limited-supply, dangerous, high-pay profession (say, working on an oil rig in the Gulf), or women dominate in a glutted profession like K-5 teaching.) As Goodman points out, it's business, not personal. The "vast male conspiracy" is just a disingenuous myth: employers (e.g., female-owned or -led companies) would have an incentive to arbitrage any alleged general difference.

I mentioned that the last employer I had before becoming a full-time resident doctoral student in Houston had decided to move our business office near his home in the northwest Houston suburbs. (I was working in the APL timesharing industry, which was basically beginning to disappear in the first years of the business PC revolution. Mainframe computers were expensive, and timesharing was an interim solution. We were in a market segment which supported rapid application development through a value-added version of APL, an interpretive computer language.) My male boss decided that he was going to set up his own company programming company staffed entirely by women out of the same office for exactly the purpose Goodman suggests: he felt that he could hire female programmers cheaper and thus make more money.

As a researcher, I'm reluctant to make any generalizations based on my experience. My first female boss was the social work librarian at OLL, and I was doing work-study; let's just say there were challenges, and she had other responsibilities. She later confessed that my overload was intentional, she had expected me to quit and was astonished that I was running the library by myself. I actually thought that she was one of my better bosses. But of the bosses or project managers I've had to deal with, 5 of the 7 worst were women, hands down, not even close.

It's difficult to generalize, but I would say some of it has to do with management style, defensiveness over technical issues, a need for external validation of their authority, disproportionate responses to circumstances, and poor interpersonal skills. (Perhaps indecisiveness, a lack of confidence, or insecurity?) On occasion there's this obnoxious "it's because I'm a woman, isn't it?" tone. I've rarely had to argue with a male boss once I've made my case on a technical issue.

I'll give an example. I found an ERP patch was failing because the database was created with the wrong character set (Oracle's default character set, versus the software prerequisite of a Western European character set). The client had hired an Oracle DBA, without relevant ERP experience, to move their production database across servers, and in the process he recreated the database without specifying the correct character set. (I could even prove that he did this because I found the logs of his procedures.) Oracle at the time would only support a resolution by recreating the database with the correct character set and importing data, a process that would take several hours, probably over a holiday weekend.  I explained that using the wrong character set violated Oracle tech support requirements, I presented evidence of the current character set, the ERP documentation showing in its appendix the requirement for the non-default character set, and an Oracle white paper from Metalink (Oracle's support database) confirming my specified solution in the client's case.

Among other things, there was a troublemaking contractor telling the female IT vice president that he thought that it was unnecessary and that I was just trying to bump up my billable hours (for doing the recreation task). I believe that the number of billable hours was fixed by contract, and likely there would be comp time adjustment; if she preferred,  the VP could hire someone else do the task. I was working on the test system; the test system was a clone of production. I was trying to help the client get back into Oracle tech support guidelines. I had a professional responsibility to press the issue.

I then get called into a meeting days later where the IT VP presented me with documentation from Oracle's product website saying that Oracle supports the default character set for its databases. (Of course, Oracle supports its default character set--as well as other character sets! Not the point: some applications may require the database to use a specific, non-default character set.) She eventually approved the task.

In contrast, in a number of projects, client managers on the first day said effectively, "Here are the car keys; you have my full backing. If one of my people causes a problem, let me know, and I'll handle it."

In another case I've mentioned in a past post, I was brought in to implement Oracle Application Server at a Navy base in south Maryland when the personnel of a well-known defense contractor, the prime contractor,  had failed to do so twice. There was a custom application running on (no longer supported) Oracle Developer 6i that needed to be upgraded to 9iAS. The defense contractor personnel had told the project manager that they had upgraded the application. When I confirmed I had completed the test 9iAS environment, the prime contractor claimed that I had botched the install because the application failed to work. I discovered that  the failure was occurring because of a failed call to use a custom print driver. 9iAS had desupported custom print drivers; instead it would generate output using a standard output type, like RTF or PDF. Oracle had a migration script for application code, and when I ran the migration script, the obsolete printer calls were flagged. I now had concrete proof that the prime contractor never upgraded the application. The prime contractor switched developers on the task, but I worked with the new developer to generate one of the new standard outputs.

Now one of the task criteria the project manager had required is basically compatibility with existing procedures. Clerical personnel had to do setups to put generated custom application printouts in Microsoft Word.

At some point the Navy PM went on holiday leave. I've finished my test server setups, but I've had to wait, because I wanted to upgrade from 9iAS to new 10G AS. (The reason is because Oracle always wants customers on the latest version, and there was no point in bringing up the application in 9iAS just to upgrade it again a year or two later.) I was warned that installing the software on a test server without the PM's authorization could get me into legal trouble.

So when she came back, the PM did a conference call to address a number of issues. I thought all that's left on my plate is doing the 10G AS install.

During the meeting she swerved me and started talking about how generating PDF's or RTF's is a violation of her primary directive of no changes in current procedures. PDF's were not the current custom driver outputs that clerical personnel had to do a lot of busywork in document preparation. I patiently explain again that 9iAS (and above) does NOT support custom drivers; it's an Oracle product design issue. She snapped, "We're the Navy, and Oracle will do what we tell them to do."

Keep in mind I was at a conference room table with prime and subprime contractors around the table. She then started going after me, saying that she had told my employer to subcontract the position to Oracle Consulting. I reminded her that I was a former senior principal with Oracle Consulting. (As an aside, my employer had presented my credentials to her before I started the assignment; I worked in a secured building and did not have a security badge into the building.) She then snapped back that the application server wasn't my area of expertise.

But I'm a special case, it is a rare manager or educator whom knows how to deal with talented, bright people.We have to deal with problems other people don't encounter: e.g., a manager's insecurity that you pose a threat to his job. For example, in my first IT job, I worked for a well-known, highly regarded insurance company. The property-casualty actuary department was creating its own tech team of 4 people; I was placed into the trainee position. The projected supervisor from Blue Cross decided not to take the job, and  the position went vacant for a few months after I joined. (One of the other programmers was also from Blue Cross, while the other was an existing department employee whom hadn't advanced in the actuary certification track and had been doing tech work.) They had decided to expand the unit but refused to promote the incumbent into the supervisor slot, which he resented. When the supervisor hire fell through, the department told the incumbent programmer to take charge of my training on an interim basis. It probably lasted all of 30 seconds. Joe told me, "Ron, nothing personal, but since I'm not the supervisor, your training is not my responsibility." I trained myself. Eventually the position was filled internally from an IT department employee whom had connections with one or 2 actuaries on prior projects. This guy did not have a college degree or programming skills, and he had this 22-year-old kid working for him whom had earned his first Master's 18 months earlier. He admitted to my face that he saw me as a threat to his position and made my life miserable in an attempt to get me to quit: for example, he refused to assign me to high-profile projects, and in one case he decided to reassign a promised key project to an incoming summer intern. (I joined the Houston branch of the leading APL timesharing company after working for the insurance company for roughly a year.) So, yes, my worst manager was a man.

I'm not saying that male managers are perfect; it's just in my experience the nature and extent of the issues is different. In my experience, most male bosses project a calm, even-tempered persona, don't argue or assert their authority (but they can be Machiavellian). The best boss I ever had? My manager at Coopers & Lybrand (unfortunately, the partners dissolved the practice he headed before the Price Waterhouse merger). I also had a couple of great managers at a prior company eventually acquired by Equifax

The co-founder of the Equifax acquisition (Phil was a techie and the CEO Ken was more of a sales guy) just loved some developer work I did; he liked to create computer games, and he used to get up early to work on them before coming to work. He was like, why would you want to do DBA work when you can develop things? Until he saw me work as a DBA. And recommended me to replace him when he left to join another company.

Reflections on the GOP National Convention Day 3:
Part 3

Romney's Acceptance Speech (continued)

• You know there's something wrong with the kind of job he's done as president when the best feeling you had was the day you voted for him. The President hasn't disappointed you because he wanted to. He took office without the basic qualification that most Americans have and one that was essential to his task. He had almost no experience working in a business. Jobs to him are about government.

I edited out a statement here, but I still don't like the way that he's approaching this issue. The immediate response is: how much experience, Mitt? You just selected Paul Ryan to be your VP, and at 42, he's been in Congress since 1999. He has not been an executive. There's a similar Achilles heel like McCain's selection of Palin, whom did not have McCain's federal experience. Romney also has to worry here about tone, because it can come across as condescending.

I do agree with what he's saying, but not with how he's saying it. I would say something like this:

"The private sector, unlike the public sector, cannot coerce consumers to buy their goods or services. They have to persuade consumers to purchase existing or innovative products and services at an attractive price. Businesses hire people to sell, produce or staff and manage revenue-generating goods and services; generally speaking, businesses hire more workers to start or expand profitable operations.

"Businesses are impacted by the actions of government: government can expand (through trade treaties) or restrict markets, and government affects business costs by taxes, regulations, and monetary or trade policies.

"Government can help businesses grow by limiting its footprint and costs, minimizing barriers to enter or exit markets or resources, ensuring a strong currency and minimizing uncertainty over government policies (e.g., expiring tax cuts, uncertain spending cuts).

"What Barack Obama doesn't understand is free market and free trade principles. He thinks that central planning and government intervention are helpful or even necessary. He's wrong: government unnecessarily obfuscates the markets. What is the real market demand for goods or services when you temporarily subsidize certain products or services?

"His lack of executive experience also hurts. Even state and local governments must live within their means. Today the government is eating nearly a quarter of GDP, several percentages over historical norms. Government is spending money that otherwise would be available to new or expanding companies needing to grow. Government imposes the highest business income tax bracket in the developed world. It also plays winners and losers in the economy; individuals and other businesses have to make up the difference for tax-advantaged companies."

• I learned the real lessons about how America works from experience. When I was 37, I helped start a small company. My partners and I had been working for a company that was in the business of helping other businesses. So some of us had this idea that if we really believed our advice was helping companies, we should invest in companies. We should bet on ourselves and on our advice. So we started a new business called Bain Capital. The only problem was, while WE believed in ourselves, nobody else did. That business we started with 10 people has now grown into a great American success story. Some of the companies we helped start are names you know. We weren't always successful at Bain. But no one ever is in the real world of business. That's what this President doesn't seem to understand. Business and growing jobs is about taking risk, sometimes failing, sometimes succeeding, but always striving. It is about dreams. It's the genius of the American free enterprise system – to harness the extraordinary creativity and talent and industry of the American people with a system that is dedicated to creating tomorrow's prosperity rather than trying to redistribute today's.

This is a good discussion. It's clear from context that Romney is referring that attack on success is more than lip service, but dysfunctional policies. What I want to see Romney do here is flesh out what sins of omission and commission Obama is making from a public policy perspective, e.g., more free trade pacts, lower, simpler income tax policies, government spending cuts, scaling back or repealing regulations, etc. I would have also sharpened up the examples he gave, i.e., Staples, Bright Horizons, Sports Authority, Steel Dynamics, etc., by talking about jobs from zero to current. More importantly, I would have focused on the point that the federal government didn't have to put up one penny for this job growth to occur.

• That is why every president since the Great Depression who came before the American people asking for a second term could look back at the last four years and say with satisfaction: "you are better off today than you were four years ago." Except Jimmy Carter. And except this president.

He fleshes things out a bit later, but he should be more specific: family wealth, income, jobs and/or inflation.

• In the richest country in the history of the world, this Obama economy has crushed the middle class. Family income has fallen by $4,000, but health insurance premiums are higher, food prices are higher, utility bills are higher, and gasoline prices have doubled. Today more Americans wake up in poverty than ever before. Nearly one out of six Americans is living in poverty. Look around you. These are not strangers. These are our brothers and sisters, our fellow Americans. His plan to raise taxes on small business won't add jobs, it will eliminate them; His assault on coal and gas and oil will send energy and manufacturing jobs to China; His trillion dollar cuts to our military will eliminate hundreds of thousands of jobs, and also put our security at greater risk; His $716 billion cut to Medicare to finance Obamacare will both hurt today's seniors, and depress innovation – and jobs – in medicine. And his trillion-dollar deficits will slow our economy, restrain employment, and cause wages to stall.

Whoa! I understand the politics of including Defense spending cuts and the Medicare cuts. Defense spending is part of government's trillion-dollar deficits. As for Medicare cuts, we need to talk about double counting and how Obama has failed to take any initiative on resolving over $40T in unfunded senior citizen entitlements.

• And unlike the President, I have a plan to create 12 million new jobs. It has 5 steps: increase domestic energy exploration and production; educational choice; new trade agreements; cut the deficit and put America on track to a balanced budget; help small business (by extending higher income tax rates, simplifying regulations, and repealing and replacing Obamacare).

I'm a little confused on how expanding school choice creates jobs; I don't like just focusing on small businesses: I want to argue on simplification of business taxes and regulations across the board. I would like to see more of a breakout of the 12 million new jobs; over the past 12 years, we've had around 1 million jobs added.

• President Obama promised to begin to slow the rise of the oceans and heal the planet. MY promise...is to help you and your family.

Russ Roberts of Cafe Hayek has an excellent point to make about this line of Romney's speech, and I concur. First, I want to make a more general point: Romney is making talking points here that are very similar to Obama's, e.g., small business relief, etc. For political posturing, you want to emphasize your differences on policy. For example, Obama and Romney are both making similar talking points about small businesses, all of the above energy, education reform, etc. If people don't think there are policy differences, they could decide to vote for the known Obama versus the unknown Romney.

Romney has apparently forgotten one of Reagan's most famous lines: "The nine most terrifying words in the English language are, 'I'm from the government and I'm here to help.'"  I would prefer Romney said something like this: "My promise is to stop the government from spending beyond its means, to pay down our debt, to face up to our commitments in unfunded liabilities, to stop interfering in the lives of private citizens, and to restore a measure of economic liberty."

I expect to finish my analysis of Romney's speech in tomorrow's post.

Jerry Brown v Chris Christie:
Put My Money on the Big Man

Talk about thin skin: when I came across this video of the Master Legal Plunderer of the People's Republic of California, I had to go to a transcript of Gov. Christie's (R-NJ) keynote speech because I didn't remember his mentioning Jerry Brown. It turns out that Christie's remarks were made on Monday morning at the Tampa hotel of the California delegation. (Because of weather, Monday's convention events were postponed or cancelled; the convention was briefly gaveled into session.) I personally prefer my one-liner: "I never realized how obsessed Californians were with recycling until they started recycling governors and ideas from the 1970's..." Jerry Brown has thin skin; here in front of his union supporter audience he starts boasting of labor legislation that he signed in the 1970's, not unlike how pro wrestler Mick Foley gets cheap pops by paying tribute to the home town or local sports teams at arenas. Thanks for reminding us all about your part in helping create the unsustainable California pension system, Jerry: isn't payback a bitch? Yes, Jerry, no doubt you as well as other Democrats are very nimble in sidestepping blame and running away from your record, but I like Governor Christie when it comes to holding the line on state budgets, tackling tough issues, and grappling with opposition legislatures.





Musical Interlude: My Favorite Groups

Cheap Trick, "Surrender"