Business Math + Banker's Math: 0 = - 4

That's right, Business Math.  In my previous series of Banker's Math blogs I have railed against some of the practices of the banking industry that I consider excessive, like 9% ATM fees and unnecessarily high mortgage refinancing costs. Today's topic, though, is an example of how business calculations in conjunction with banking practices can sneakily take more money out of your pocket.

My wife and I travel internationally quite a bit.  As I've mentioned before, we've managed to minimize fees for transactions in foreign currency by using a credit card that waives the usual 3-4% extra charge and an ATM card that doesn't have fees on our side of the transaction.  For the past several years this has worked out well, and we've probably saved hundreds of dollars.

But after our most recent trip -- a very enjoyable three weeks in northern Italy -- I discovered a new wrinkle in the foreign transaction boondoggle, this time by a U.S.-based rental car company, not a bank.  Of course, rental car companies have long been notorious for some pretty sleazy practices, so maybe this should not have been a surprise.  But after researching this more thoroughly I have learned that a number of businesses, including local merchants are also joining in.

The practice is known as DCC, or "Dynamic Currency Conversion."  A merchant can bill you in local currency, say Euros, then convert the amount to Dollars through a financial services company, add on 3-4% and charge your credit card the total dollar amount.  Merchants make money off of this because they keep the conversion charge (minus some fees they have to pay to their financial services company).  If you have a credit card that charges international transaction fees (ours doesn't but most do), you could also pay your own company another 3-4% even though they didn't do the conversion because the fee is for any transaction that goes through a foreign bank regardless of currency.  Total cost of the charge then is 6-8%.  And this may happen even without you being aware of it.

In our case we rented a car from Budget which we picked up and returned in Milan.  When we turned in the car the agent gave us a receipt in Euros which was the exact amount we had been quoted when reserving the car online, and so we were satisfied. We left thinking our credit card would be charged the total on the receipt, in Euros, with the conversion to Dollars handled by our credit card company for which there would have been no fee.  Nope.  When the charge appeared on our statement it was 4% higher than it should have been.

I emailed Budget's customer service and asked why the amount was too high.  Here are excerpts from the subsequent exchange.

Budget: Thank you for contacting the E-mail Customer Service team.
I truly apologize for the inconvenience and confusion; however, the total indicated on the final rental receipt is showing as 399.59EUR which was converted to 548.21USD.  Please note that, because the conversion to be made by AvisBudget was signed for on the rental agreement rather than allowing your banking institution to process it, an additional 3-4% conversion fee was also assessed.  This may explain the slight difference after conversion.  I hope this information helps clarify.

Badabing!  In other words, I apparently agreed to this when I signed the rental agreement though I don't recall seeing it in the fine print (unfortunately I can't find my copy of the contract to check) nor is it to be found anywhere in the online conditions listed when you reserve the car.

So, is it possible to avoid this? 

Me:  Thank you for your fast reply.  Is there any way I can avoid this additional 3-4% in future international rentals with Budget?  I have a credit card that explicitly waives international transaction fees and I would like to take advantage of it (I thought I was doing so in this case).  If other companies allow the rental to be processed by my banking institution then I will likely use them instead. 
Budget: Thank you for contacting the E-mail Customer Service team. When you get to the counter to pick up your rental you need to tell them that you do not want to be charged in US dollars. This way you will be charged in the currency of the country and your credit card company will do the conversion. If we can be of further assistance, please let us know.

There you go, all you have to do is ask.

Maybe.

Fast forward to planning for a trip next year to Chile, where we are going to rent cars in two different locations.  Budget does business in Chile and our research found their rental rates to be competitive.  Encouraged by Budget's emails we reserved cars with Budget, but I thought I'd check on the conversion policy just to make sure I had it right. So I emailed customer service again.

Me: I have reserved Budget cars in Chile for our trip next year and will use a U.S credit card to pay for the rentals.  How can I make sure that the currency conversion from CLP to USD will be handled by my Credit Card issuer rather than Budget?
Budget: Thank you for contacting the Budget E-mail Customer Service team. You will need to request that you are billed in USD when you arrive at the location to avoid this. [my emphasis]

Whoa! Note that this is exactly the opposite advice I received earlier (and very likely wrong).  Confusing?  I wrote back pointing out my experience in Italy and asking if the conversion policies were different in Chile.  Here's the reply.

Budget: Thank you for contacting Budget. Budget locations in Italy and in Chile are independently owned franchise locations and may have different policies in place which deviates from standard policy. As advised, renters are to make their currency request [my emphasis] at the beginning of the rental. We apologize for any misunderstanding or inconvenience. If we can be of further assistance, please let us know.

Not helpful.  The advice is for renters to make their currency request at the beginning of the rental.  But which request?  Dollars?  Local Currency?  Do you still sign the same contract?  If you do sign it what recourse do you have later if they don't follow your request?  What do you do if they refuse? Try on the spur of the moment to rent from another company?

Well, at least the customer service person was polite.

Now I know some of you are saying,  "Just use a different company."  But a little internet research reveals that others do this as well.  For example, I found a forum exchange from 2010 in which Hertz did exactly the same thing to a customer.  And as my email exchange above shows, it isn't easy to find out a company's policy in advance, even if you contact them directly and ask.

And now for the coupe de grace. On Budget's web site they offer to show you the estimated total for your rental in either dollars or in pesos.  If you reserve your car based on the dollar estimate, then show up and get them to charge you in pesos instead (thus avoiding DCC), what rate do they use to calculate the pesos total?  Answer:  compared to the global standard rates available on www.xe.com, Budget adds 1 %!!  (It could be worse -- Thrifty adds 2%).  So even if you pay in pesos and use your no-fee credit card, you will still pay at least 1% more.

There you go.  My smugness in thinking I had achieved a consumer victory by using a credit card with no international transaction fees was unjustified.  In Business Math + Banker's Math: 0 (no fees) = - 4 (gotcha anyway!).

I'll let you know how the Budget rentals in Chile turn out.
______________________________________
Here's some additional reading on this topic if you're interested:

• A succinct statement of the practice and the potential problem: http://www.cardhub.com/edu/dynamic-currency-conversion/
• A statement by FEXCO, a financial services company to merchants touting the benefits of the DCC program.  FEXCO was apparently the company that came up with this wonderful "service" back in 1996:  http://www.fexcoms.com/products/dynamic-currency-conversiondcc/
• A statement by KeyBank, a major financial services company in the U.S. and Europe, touting the financial benefits to merchants and supposedly to customers:  https://www.key.com/business/collecting-payments/dynamic-currency-conversion-banking-service.jsp 
• A 2008 forum discussion started by a credit card holder describing the difficulties in trying to opt out of this practice:  http://www.flyertalk.com/forum/credit-card-programs/916377-dynamic-currency-coversion-should-illegal.html
• A 2011 blog that offers a critical look of the DCC practice from the consumer's point of view.  Includes a reader who had a similar experience as ours with Dollar Rental Car: http://www.askmrcreditcard.com/creditcardblog/the-foreign-conversion-scam/
• A 2005 study by a consulting firm regarding DCC's acceptance by merchants and customers: http://www.psel.co.uk/pdf/articles/acquiring/dcc_myth_vs_reality.pdf

Breathing Again .... Again

Four years ago November 5th I wrote that I was Breathing Again after the divisive and derisive campaigning of McCain and Palin failed to win the White House for the GOP and Obama was elected by a substantial margin.  I also cautioned, however, that the euphoria over his election was likely unwarranted by political reality -- though at the time I didn't foresee the magnitude of the obstructionist tactics the GOP/Tea Party would employ to limit his effectiveness.  During this campaign I was holding my breath again because the strategy of Romney/Ryan was working and it seemed there was a very real prospect of not only a GOP president but also both House and Senate controlled by fiscal and social conservatives with no interest in compromise or consensus (recall John Boehner's adamant rejection of the word "compromise").  And so I'm breathing again....again.

But once again I'm not euphoric.  It is clear that nearly 1/2 the nation's voters saw Romney and Ryan in a positive light and therefore any solutions to the nation's economic and social problems have to consider their conservative viewpoints.  There was no mandate given here, other than through the polls that repeatedly show that most Americans want government to solve problems, not remain paralyzed by unbending adherence to a single philosophical agenda. And I can hardly be encouraged by the fact that this election may have simply maintained the status quo in congress of the last two years which showed a stunning inability to solve anything.

It is correct to say that our congressional leaders have become polarized and the distance that must be bridged in order to reach agreement is greater than it has been in a long time.  However, the GOP has moved farther to the right than the Democratic Party has to the left.  There was a time when I could have accepted a GOP dominated government because accommodation and negotiation (aka "civility") were still the norm.  But not now.

Maybe the positive impact of the election will be in causing the GOP/Tea Party to re-examine its position on the political spectrum and its relationship to a broader electorate.  Michael Gerson of the Washington Post recently offered an analysis of this possibility that I think is very insightful and I'll close with his words:

Some of the most important intellectual groundwork is needed on the role of government. Mitt Romney had a five-part plan to encourage job creation. He lacked a public philosophy that explained government’s valid role in meeting human needs. Suburban women heard little about improved public education. Single women, particularly single mothers, heard little about their struggles, apart from an off-putting Republican critique of food stamps. Blue-collar workers in, say, Ohio heard little about the unique challenges that face declining industrial communities. Latinos heard little from Republicans about promoting equal opportunity and economic mobility.

Neither a vague, pro-business orientation nor tea party ideology speaks to these Americans — except perhaps to alienate them. Conservatives will need to define a role for government that addresses human needs in effective, market-oriented ways. Americans fear public debt, and they resent intrusive bureaucracies, but they do not hate government.  [Emphasis added]

 We'll revisit this topic in another couple of years to assess if the situation has improved.  In the meantime I'll keep breathing, but I will also keep my fingers crossed.

Don't Go To Your 50th High School Reunion!

I recently attended my 50th high school reunion -- an "interesting" experience. 

This was my first reunion with my classmates over the years.  I've received notices for the interim gatherings but it never seemed worth the expense and time to attend any of them.  However, the 50th seemed significant somehow -- a milestone worth acknowledging.  It also seemed to fit in with my more reflective and nostalgic tendencies associated with retirement.

One thing I learned right away is that the internet has made reunions much easier to promote and to manage.  Websites like ClassReport.org, Classmates.com,  MyEvent.com allow organizers to display information about the event and to provide biographical and contact information about alumni.  (I'm sure that Facebook will soon find a way to supplant these independent venues and make it even easier to do this. For the potential downside, see my cautionary blog about Facebook.) Very slick.

I graduated from South High in Denver.  We were the South High Rebels, a designation clearly linked to the Confederacy and the Civil War. On the reunion website was our logo, the profile of a confederate soldier.  We were obviously less culturally sensitive in those days (imagine being one of the few Black students at our school during a rally to cheer on our Johnny Reb football team).  Just for kicks I went to the current website for South High and found that the "Rebels" term is still used, though the soldier has been replaced by a more neutral block letter "S."  The current website also extolls the school's diversity (not a defining characteristic while I was there) and its goal of developing in students "...a sense of civic responsibility to contribute to their global community."  Sounds great.  I just hope they don't still wave little confederate flags at the rallies like we did.

Since I really didn't keep in touch with very many of my classmates after graduating, I was curious to read the biographical information posted on the website.  I learned three things from this.  First, I couldn't remember most of the people in my class (this might be due in part to the sheer numbers involved -- there were 700 in my graduating class).  Second, of the ones I could remember a disturbingly large proportion of them were dead.  Third, the people I recalled most fondly were often those with whom I had also attended junior high, where we were "tracked" -- the same group of kids went from class to class for three years and we got to know each other very well.

At the event itself we were given id tags with our yearbook photo and name.  This was very helpful, because most people didn't look much like they did in high school.  Even when I could place either the face or the name, I was often at a loss to remember the context in which I knew the person.  It was an exhausting cognitive effort to bridge a gap of 50+ years when there was no connective thread between then and now, nothing in the middle.  By the end of it I came to the painful realization that as emotionally charged as those days may have been at the time, they have little relevance for my life today.  Revisiting memories of those times was actually a little depressing, because it didn't reveal any significant truths about who I am today (as I thought it might) and instead presented a puzzling and disjointed picture of someone I hardly recognized.

I realize that for many people high school memories are very positive and that reunions are a joyful and heartwarming way of maintaining meaningful relationships.  My high school experience was not so great.  It was a period in my life of great uncertainty, social isolation, and near-calamitous life choices. Somehow I pulled out of it in time, and I now think high school was something I survived, not something I enjoyed.  The reunion did what I guess it should have -- it reminded me that now is the most important time of my life, not the past.

Microbes for Breakfast!

On the breakfast buffet table was a big bowl of white stuff the consistency of thick whipped cream.  The little sign beside it said "Yogurt." Normally I would have moved right on to the real food, since at that time I placed yogurt in the same "not-past-my-lips" category as cottage cheese (what are all those lumps, anyway?) and buttermilk (anything that leaves scum that thick on the empty glass can't be good).

This was in 2003, on our third trip to France. Previous visits had introduced me to some fabulous French food and although for most of my life I've not been very adventurous when it comes to eating I tend to throw caution to the wind when traveling there.  And so I tasted it.

Well, as has happened a few other times in France, I thought I had died and gone to heaven (two other occasions were when I tried my first chocolate croissant and when I took my first bite of Roquefort cheese).  This homemade yogurt stuff was rich and creamy and smooth and not quite like anything I had ever tasted before -- I loved it.  Wow, me eating yogurt -- wonders will never cease!

Since then I have become a real yogurt fan, and now I have it for breakfast (usually with granola my wife makes) almost every day, and when we travel I seek it out whenever possible. But those who know me will understand that I don't just eat it -- I've had to investigate it and research it so I can justify my recent passion for something I rejected for most of my life.  And what I've learned is that (a) yogurt is one of nature's most perfect foods and (b) many of its beneficial qualities come from a most unlikely source -- microbes, aka "germs."

Webster's defines yogurt as "a fermented slightly acid often flavored semisolid food made of milk and milk solids to which cultures of two bacteria (Lactobacillus bulgaricus and Streptococcus thermophilus) have been added."  Sometimes other strains of bacteria are also added.  Sounds yummy, right?  Fermented....semi-solid...bacteria...... Had I read this first I would never have tried it.

Yogurt can be made from the milk of cows (most common in the U.S. and Europe), sheep or goats (common in Turkey, where yogurt probably originated), and water buffalo (India & Egypt). Each of these has a different flavor and texture.  Greek style yogurt is strained to remove some of the liquid and is therefore thicker and a bit more tart.  Yogurt can be made from whole milk or from reduced-fat milk.  When the source is low-fat or non-fat milk the resulting yogurt has almost no cholesterol and the calories it contains are nearly all from protein, a very good thing from a health viewpoint (though there is some loss of flavor -- let's face it, fat tastes goooood).  Assuming the yogurt hasn't been adulterated by adding sweeteners, the nutritional qualities are remarkable.  It is a food that is high in protein, calcium, and several vitamins but low in fat and cholesterol.

But that's not all.  What about those bacteria?  It may be obvious that they are responsible for the fermentation process that results in yogurt, just like microbes are used to make beer, cheese, and wine.  However, in those cases the bacteria are pretty much finished once the job is done and they convey no particular health benefits of their own.  In yogurt, though, they continue to produce benefits even after the yogurt is consumed, assuming they are still alive (some manufacturers heat the finished yogurt, which kills the bacteria).  That's right, it is healthier to eat live germs than dead ones.  Here are some of the health benefits that research has shown derive directly from the live bacteria, excerpted from a summary by the Dr. Sears Health Group:

• Yogurt is easier to digest than milk. Many people who cannot tolerate milk, either because of a protein allergy or lactose intolerance, can enjoy yogurt. The culturing process makes yogurt more digestible than milk. The live active cultures create lactase, the enzyme lactose-intolerant people lack, and another enzyme contained in some yogurts (beta-galactosidase) also helps improve lactose absorption in lactase-deficient persons. Bacterial enzymes created by the culturing process, partially digest the milk protein casein, making it easier to absorb and less allergenic.
• Yogurt contributes to colon health.  ... yogurt contains lactobacteria, intestines-friendly bacterial cultures that foster a healthy colon, and even lower the risk of colon cancer. Lactobacteria, especially acidophilus, promotes the growth of healthy bacteria in the colon and reduces the conversion of bile into carcinogenic bile acids. The more of these intestines-friendly bacteria that are present in your colon, the lower the chance of colon diseases. Basically, the friendly bacteria in yogurt seems to deactivate harmful substances (such as nitrates and nitrites before they are converted to nitrosamines) before they can become carcinogenic...For senior citizens, who usually have more sensitive colons or whose intestines have run out of lactase, yogurt is also a valuable food. Elderly intestines showed declining levels of bifidus bacteria, which allow the growth of toxin-producing and, perhaps, cancer-causing bacteria. [my italics]
• Yogurt improves the bioavailability of other nutrients. Culturing of yogurt increases the absorption of calcium and B-vitamins. The lactic acid in the yogurt aids in the digestion of the milk calcium, making it easier to absorb.  
• Yogurt can boost immunity. Researchers who studied 68 people who ate two cups of live-culture yogurt daily for three months found that these persons produced higher levels of immunity boosting interferon. The bacterial cultures in yogurt have also been shown to stimulate infection-fighting white cells in the bloodstream. Some studies have shown yogurt cultures to contain a factor that has anti-tumor effects in experimental animals.
• Yogurt is a rich source of calcium. An 8-ounce serving of most yogurts provides 450 mg. of calcium, one-half of a child's RDA and 30 to 40 percent of the adult RDA for calcium. Because the live-active cultures in yogurt increase the absorption of calcium, an 8-ounce serving of yogurt gets more calcium into the body than the same volume of milk can.  [my italics]
• Yogurt is an excellent source of protein. ...Besides being a rich source of proteins, the culturing of the milk proteins during fermentation makes these proteins easier to digest. For this reason, the proteins in yogurt are often called "predigested." 
• Yogurt can lower cholesterol. There are a few studies that have shown that yogurt can reduce the blood cholesterol. This may be because the live cultures in yogurt can assimilate the cholesterol or because yogurt binds bile acids, (which has also been shown to lower cholesterol), or both. 

So the lesson here is that although there are plenty of nasty microbes out there that will kill us or make us very sick, there are many that do the opposite.  In fact, as detailed in my blog "How About A Fecal Transplant?"  we apparently can't live without some of them residing in our guts.

And of course the additional lesson of yogurt is that these little critters can be very tasty, too.

________________________
Some additional info:
A summary of research studies on the benefits of yogurt from the National Yogurt Association.

WebMD's summary of yogurt benefits.

Mini Monks in Myanmar

Earlier this year my wife and I had the good fortune to visit Myanmar (aka Burma) for about three weeks.  I emphasize "good fortune" because it was one of our best travel experiences ever -- warm, friendly and welcoming people, surprisingly good food, rich history, exotic culture, astonishingly beautiful Buddhist monuments and archeological sites.  "Good fortune" too in that geopolitical shifts suddenly allowed us to make the trip before mass tourism takes its inevitable toll.

We've wanted to travel there for years but didn't want to support the corrupt and repressive military regime that seized power in 1962.  This is the government that caused international condemnation in 2007 when it refused humanitarian aid after a horrific typhoon hit the southern provinces leading to an estimated 180,000 deaths from disease and starvation.  It also held the pro-democracy leader Aung San Suu Kyi under house arrest for much of the last 20 years, despite the fact that in 1990 she resoundingly won the first election held after the military takeover. Recently however the military has introduced significant political, social, and economic reforms that have led to an improvement in relations with the U.S., giving us the opportunity we've been waiting for.

Of Myanmar's 56 million population, about 500,000 are in the military.  A fairly large army is needed because this is one of many countries in the world where order and stability come from the barrel of a gun.  But there are also about 300,000 Buddhist monks in Myanmar, a striking spiritual counterweight to raw physical force. Their orange robes and shaved heads make them stand out everywhere, adding to the exotic atmosphere that emphasizes to a Western visitor that "Toto, we're not in Kansas anymore."  There are also about 20,000 Buddhist nuns who also shave their heads but wear pink robes instead of orange.

The country is 89% Buddhist, a large portion of whom are fairly devout. Christians and Muslims are a tiny minority, about 4% each, with the remainder being mostly Hindu. There are very few Jewish citizens. This is a different variety of Buddhism than the type we saw in Bhutan (see my blog Bummin' With Buddha in Bhutan) though the basic tenets are the same. As was the case in Bhutan, Buddhism incorporated earlier religious beliefs rather than attempting to supplant them. In Myanmar this involves belief in Nats, spirits who inhabit objects and places and who have the power to protect those who worship them.  Monks seem to tolerate this but do not promote Nat worship. In the 11th century the monastic order cleverly declared that the most powerful of Nats had historically paid homage to Buddha, thus making all Nats subordinate to Buddhism. Despite this rather obvious self-serving maneuver, I found Buddhist practice in Myanmar much more agreeable than in Bhutan, where the monastic order seems to actively encourage and benefit from decidedly non-Buddhist beliefs in magic, superstition and demons.

The sight of thousands of monks and nuns is certainly novel to most Western visitors who have at best a rudimentary understanding of Buddhism.  Even more striking is that many of these monks and nuns are children as young as ten years old. This is very hard for someone raised in the deist religions of Christianity, Judaism, or Islam to grasp. For us clerical robes usually signify a consecrated spiritual leader dedicated to transmitting received knowledge to the laity -- definitely not something a 10-year old is capable of doing. Somewhat closer to the Buddhist concept are cloistered monastic orders in which monks and nuns dedicate themselves to a contemplative life rather than service to the larger community. But in Western religions children would not likely be candidates for such an order.

So what are these mini monks and mini nuns doing and why are they doing it?  The answer is a bit different for males and females.  In Myanmar (as in neighboring Buddhist countries Thailand, Laos and Cambodia) all Buddhist males are expected to become members of the monastic order twice during their lives -- once as novices between the ages of 10 and 20, and again as an ordained monk sometime after age 20.  These are usually temporary associations, though about 15% become permanent.  For girls there is no requirement to become a nun, but joining the order offers an attractive means for social advancement, especially for those of low economic status.

The novices reside in a monastery or convent and follow the daily monastic routine which involves secular and religious education as well as meditative practice.  For Buddhists meditation is the primary means of progressing toward the goal of enlightenment and thereby achieving Nirvana, the complete absence of suffering and unhappiness.  Meditation is not prayer or worship in the sense of deist religions but rather a way to gain control over one's mind and emotions, to develop insight into the nature of suffering and unhappiness, and to achieve a deeper understanding of life. I suspect that younger novices might have difficulty with some of the more complex issues but they still benefit in both the short and long term from acquiring the self-control and discipline needed for meditative practice. Thinking back to my own youth I am certain this would have been time better spent for me than the semi-delinquent and angst-ridden things I actually did.

For us the chance to interact with these mini-monks and nuns was one of the highlights of the trip.  Like many children of that age they were very curious about us and eager to practice their English. We had many enjoyable encounters with them but one special time for me was at the beginning of the trip in Yangon, when we paid an evening visit to the famous Shwedagon Paya, one of the largest Buddhist monuments in the world.  Local people gather on the terrace below the central stupa in the evening to socialize and pay homage to Buddha.  I broke away from our tour group and found a quiet place to sit and observe the scene. I was soon approached by three novices 14-15 years old who politely initiated a conversation about politics, religion, and social norms.  This is a situation where my years of world travel caused a cautionary alarm to sound in my head at the beginning but it was clearly unfounded. They were delighted to learn I was an American, and even more pleased to learn I was a teacher (educators in Myanmar are highly revered).  But in this case I was the one who learned the most -- I saw first-hand the disciplined thinking, openness to ideas, skillful concentration and emotional control that are very likely attributable at least in part to being mini-monks.

I have no illusions that Buddhism in Myanmar has avoided the kinds of gaps between principle and practice that are characteristic of other religions. History has shown that when religions become institutionalized they often transform from spiritual philosophies to social organizations focused on power, status, dominance and self-preservation.  Self-righteous violence against others, exploitative accumulation of wealth, sexual misconduct of spiritual leaders, and ruthless suppression of dissent are the frequent result. A glaring example in Myanmar is the long-standing conflict between two ethnic/religious groups in the northwest: Rakhine Buddhists and Rohingya Muslims.  As reported by the BBC, recent violence erupted in late May when a Buddhist woman was raped and murdered by three Muslims. A Buddhist mob later killed 10 Muslims in retaliation, though they were unconnected with the earlier incident. In the violence that has followed about 80,000 people have been displaced and thousands of homes destroyed.

All religions are characterized by such disconnects between behavior and belief, including Buddhism, and my travels have frequently brought me face-to-face with their historical remnants around the world.  Although Buddhism is clearly not immune to this shortcoming, the historical record seems rather more negative for the major deist religions.  I am unaware of any Buddhist equivalents equal in scale to crusades, holocausts, jihads, or inquisitions.

Maybe these mini monks are on to something.

Let's Ban Political Ads!

There are many advantages to living here in Hawai'i, but one of the best is that in Presidential campaigns we don't matter.  The state population is small by national standards and our one puny little Electoral College vote doesn't warrant spending much time or money on us.  This means that we are spared the media blitz during election years that is targeted at those of you who live in more important "swing" states.

We used to live in Ohio, a state that is regularly a focus of intense campaigning. This meant lots of visits by the Presidential candidates or their surrogates, rallies, door-to-door canvasing, and a relentless barrage of 30-second t.v. spots.  This began during the primary season and continued right to the November election.

I was reminded of the obnoxiousness of the t.v. ads recently when I had to make a short trip to the mainland to attend a funeral.  The airwaves were full of 30-second ads for Romney and Obama, all of which seemed designed to be low on information and high on emotional impact. Careful factual analysis of the messages in many of these ads would reveal them to be vacuous, but then they aren't supposed to be logical or informative.  The media specialists who create these spots are masters at manipulating image, innuendo, and emotional associations (you can enjoy recent ads from this year's campaigns at Stanford's Political Communications Lab web site).  The messages may be logically weak but they can be highly effective in swaying voter opinion anyway, particularly as part of negative advertising campaigns.  This is why candidates and their supporting organizations spend so much money on media, estimated to be nearly $100 million for this month of July alone, according to Washington Post's Dan Eggan.

In the 2008 election, the total spent on media reached a staggering $359 million (see the Center for Responsive Politics for more detailed information).  The total campaign spending by McCain and Obama during that election was more that $1 billion (!) according to data released by the Federal Election Commision.  This time around more relaxed accountability rules for donations via so-called "Social Welfare Organizations," like Karl Rove's Crossroads GPS, and the recent Supreme Court ruling that corporations can donate unlimited amounts to "SuperPacs" are likely to push spending even higher.  If it weren't for the questionable ways in which this money is spent, we could regard it as a nice economic stimulus package.

Political ads have become increasingly negative over the last 20-30 years.  According to Shanto Iyengar, Director of the Stanford Political Communication Lab, negative campaigning in American politics blossomed as an effective strategy in the 1980's, pioneered by Fox News' Roger Ailes who was a campaign consultant to Ronald Reagan and George Bush at that time. Although the Republicans were the first to use negative campaigning effectively, Iyengar points out that the Democrats caught up quickly and are just as apt to use it as a campaign strategy.  His research shows that negative campaigning is particularly prominent in close elections and tends to depress voter turnout and polarize the electorate.  Given the likely closeness of the Obama/Romney race, then, we are probably going to see more and more negative ads this time around, and the campaigns will unfortunately reinforce the extreme polarization that is now paralyzing our government and will further reduce public perceptions of congress, already at an all-time low.  Whoopee.
 
Political ads are not held to the same "truth-in-advertising" principle that governs commercial advertising.  This is because they are considered "political speech" and are therefore protected by the First Amendment, to the point that broadcasters are required by law to air ads even if they contain demonstrably false information.  As a Time Magazine analysis of the 2008 election put it:

The noble idea undergirding what otherwise seems like a political loophole is the belief that voters have a right to uncensored information on which to base their decisions. Too often, however, the result is a system in which the most distorted information comes from the campaigns themselves. And as this year's presidential race is showing, that presents an opportunity for a candidate willing to go beyond simple distortions and exaggerations by making repeated and unapologetic use of objectively false statements.

So far I'd say the "this year" referred to in this analysis applies equally well to the current 2012 election.  Two online sources of unbiased examinations of the truth or falseness of  political statements that I find useful are PolitiFact.com and FactCheck.org , which I check regularly to get a more objective assessment of current campaign claims. Don't go to these sites expecting to support your hunch that one side is far more truthful than the other -- so far as I can tell the facts are abused about equally.  But the careful analyses of positions and statements (not just ads) can be very informative.

Shanto Iyengar points out that a growing trend in broadcast journalism has been to focus on political ads as news stories, which often simply gives them free air time and reduces a factual analysis to a matter of  "he-said-she-said."  In fact, savvy media consultants craft ads with this media attention in mind. For those voters who missed seeing the ads at other times, watching a news broadcast almost guarantees being exposed to at least some of them. Those who did see them during regular programming are exposed a second time.  In general news media attention to ad content rather than policy positions and proposals for solving problems may reinforce the negative tone of the election process and add to the polarization.  At the very least, focusing on ads and campaign strategy reduces coverage of more substantive information about candidates and their positions.  As Iyengar puts it: "in place of candidate positions and past performance on the issues, reporters gravitate toward the more entertaining facets of the campaign: the horse race, the advertising, the strategy, and whenever possible, instances of scandalous or unethical behavior."

Can the internet save us from this media morass?  There is no doubt that campaigning is incorporating more online technology as strategists try to reach the growing number of voters don't watch much t.v. but spend a lot of time online.  A recent report by Ryan Grim estimates that about 25% of consultant expenditures during this election cycle are going to online efforts.  And online ad campaigns seem to be effective. For example, the consulting firm Chong & Koster targeted some Florida voters with an average of five ads a day on Facebook, encouraging a no vote on a proposition that would have increased school class sizes. Voters exposed to the ads were more likely to vote no than a typical voter -- and more likely to oppose it than a typical Democrat. 

Online technology offers more than just a digitized medium for delivering the same ads, however.  Facebook and other social media are potentially powerful tools for linking candidate supporters and actively involving them in the campaign.  For instance, in one study described by Ryan Grim voter turnout was increased by messages from Facebook "friends" and people were more likely to remember information about the election when it came from a "friend" than from less personal sources.  As one top media consultant put it, candidates should not underestimate the power of social networks and peer-to-peer activism, and even though some politicians get nervous about the two-way nature of the online medium, they need to trust their supporters to fight for them in the online political debate. Whether this kind of activism produces positive or negative outcomes for the country as a whole remains to be seen.  Surely it depends on the quality and thoroughness of the information it is based on -- and this brings us right back to the original question concerning the content of campaign rhetoric.

A glimmer of hope for our electoral process is that online resources give voters access to substantive information about candidate positions on issues that is given short-shrift in in 30-second t.v. or internet ads and in most t.v. news coverage of campaign developments. Iyengar's assessment of the internet in this regard is particularly optimistic: 

...[internet] technology at least makes it possible for voters to bypass or supplement media treatment of the campaign and access information about the issues that affect them. Rather than waiting for news organizations to report on the policies they might care about, voters can take matters into their own hands and visit candidate websites to examine their positions on the issues. This form of motivated exposure is hardly an impediment to deliberation: paying attention to what the candidates have to say on the issues facilitates issue-oriented voting; paying attention to the media circus does not. Thus, there is some reason to hope that the spread of new forms of unmediated communication will eventually provide a better way to inform and engage voters.

 "Eventually" can't come soon enough for me.

Hiding From Facebook

I'm a pretty tech-savy guy.  I have a blog and my own homepage.  I have three email accounts. I own three computers, two Ipods and an Ipad. I manage our home wireless network.  I back everything up in the cloud. I'm a webmaster for an educational resource called PsyberSite. I've even taught courses about how the internet has influenced our society, for example "The Social Psychology of Cyberspace."

You might think I would be in the thick of the social network phenomenon --Tweeting and Google +'ing and Facebooking like crazy.  But you would be wrong.

There is no doubt that these recent developments in internet technology are having a tremendous impact on social relationships and the structure of our social world.  As a social psychologist I regard the social networking phenomenon as something that is very significant and fascinating to study.  And to my friends  who are Facebook fans (some of whom are reading this right now), let me assure you that I appreciate the many positive benefits this technology can have -- staying in contact with friends, sharing important life experiences with them, finding and reconnecting with old friends, and in general adding to the social richness of life. 

However, my personal reaction has been quite different.  You see, despite (or maybe because of ) my close involvement with internet technology over the years I have a skeptical, aversive, even paranoid stance regarding these latest social developments.  My wife and I do have a Facebook page, but we hardly ever post anything on it.  We have a whopping total of 36 Friends, a pretty puny number compared to some people who have hundreds.  And I admit it is fun to read the posts of others and to learn of the events in their lives and the lives of their family and friends.  But we both balk when it comes to sharing the same sort of information on our own Facebook page.  I should point out here that my reluctance is greater than my wife's, and she has sometimes expressed regret at feeling left out of this phenomenon.  (Perhaps we will soon go our separate ways and get individual accounts.)

I think there are a couple of reasons why I'm hiding from Facebook, both of them stemming from personality flaws that are long-standing and deeply rooted.

First, I'm generally a very private person and even in face-to-face situations I'm not comfortable disclosing personal information, even to very close friends.  Of course, professorial pontificating is an entirely different matter, and I have never been reluctant to do that, though my students often viewed me as "aloof" and "impersonal."  I think I'm friendly and approachable but I'm hesitant to be very open except with a few people I've know for a long time.

It is possible on Facebook to divide "friends" into differing categories like "Close Friends, " "Acquaintances,"  "Family," and even to create your own divisions.  You can also create groups of "friends" within each of these categories depending on interests or activities and then share different information with people in each one.  I don't know how many Facebook users take advantage of these features, but I find the categorization process very daunting and fraught with the danger of forgetting who is in which group and posting something that inadvertently offends someone or is at least regarded by them as inappropriate.

Another related issue for me is that as part of my private personality it is difficult to feel comfortable with the high frequency that seems to be the norm in posting Facebook information. Even with very close friends I much prefer fewer but more intense and personal interactions.

My second reason for hiding from Facebook may be that I have this "thing" about institutions or organizations that quickly become big and powerful, no matter how benign they may seem.  (See my slogan for Snow Crash.) My negative reaction is a complex bundle of paranoia, issues with authority, and wanting to assert independence by being non-conformist -- in short, not entirely rational.  Facebook is indeed big, reaching 750 million users in just eight years. And it has certainly become powerful as well.  As Steven Johnson noted in a recent Wired Magazine analysis, "Facebook is on the cusp of becoming a medium unto itself—more akin to television as a whole than a single network, and more like the entire web than just one online destination.....The difference, of course, is that no one owns the web—or in some strange way we all own it. But with Facebook we are ultimately just tenant farmers on the land; we make it more productive with our labor, but the ground belongs to someone else."

Mark Zuckerberg, founder of Facebook, wants us to be able to share everything, "...to make the world more open and connected."  He has created an interface that makes sharing extraordinarily easy to do -- but also that makes it easy for our social connections to be tracked and exploited.  Here's a small excerpt from the list of data Facebook receives and stores about users, taken from its Data Use Policy:

• We receive data about you whenever you interact with Facebook, such as when you look at another person's timeline, send or receive a message, search for a friend or a Page, click on, view or otherwise interact with things, use a Facebook mobile app, or purchase Facebook Credits or make other purchases through Facebook. 
• When you post things like photos or videos on Facebook, we may receive additional related data (or metadata), such as the time, date, and place you took the photo or video. 
• We receive data from the computer, mobile phone or other device you use to access Facebook, including when multiple users log in from the same device. This may include your IP address and other information about things like your internet service, location, the type (including identifiers) of browser you use, or the pages you visit. For example, we may get your GPS or other location information so we can tell you if any of your friends are nearby. 
• We receive data whenever you visit a game, application, or website that uses Facebook Platform or visit a site with a Facebook feature (such as a social plugin), sometimes through cookies. This may include the date and time you visit the site; the web address, or URL, you're on; technical information about the IP address, browser and the operating system you use; and, if you are logged in to Facebook, your User ID. 
• Sometimes we get data from our advertising partners, customers and other third parties that helps us (or them) deliver ads, understand online activity, and generally make Facebook better. For example, an advertiser may tell us information about you (like how you responded to an ad on Facebook or on another site) in order to measure the effectiveness of - and improve the quality of - ads.

I get very nervous when I read that list, despite assurances that my information is shared only "after we have removed your name or any other personally identifying information from it."  It seems to me that the detail contained in the information makes it very personal indeed, whether my name is associated with it or not.  I note also that the use to which my information may be put is rather open-ended.  I really don't know the specific ways Facebook uses tracking information and so I just have to trust that it will be benign.

My issues with authority and control lead me to get nervous about another aspect of Facebook -- its tendency to try to keep me within its warm and fuzzy embrace.  For example, a recent unannounced move was for Facebook to change people's email addresses that they had listed in their public profiles to addresses that use a Facebook email account.  If a friend sends a message to me at earthlink.com, for instance, it gets delivered to my Facebook email account instead.  Another development is Facebook's "Open Graph" initiative to encourage users to install apps that function within the Facebook interface even though they utilize content from the broader internet.  For example, if a friend has posted a link to a Washington Post news article, clicking on that link doesn't take you to the Washington Post web site, but rather serves the article to you through a internal app that you must install within Facebook. Of course, keeping a user within the Facebook interface allows even more thorough tracking of online behavior.  Wired's Steven Johnson raised a broader and more philosophical objection in his article that resonates well with my personality quirks:

This reluctance to link to the outside is, to say the least, hard to reconcile with Zuckerberg’s paean to open connection. Hyperlinks are the connective tissue of the online world; breaking them apart with solicitations to download apps may make it easier to share data passively with your friends, but the costs—severing the link itself and steering people away from unlit corners of the web—clearly outweigh the gains. Surely we can figure out a way to share seamlessly without killing off the seamless surfing that has done so much for us over the past two decades.

In the meantime, I'll just keep hiding......