My review of The Great Gatsby

Ralph Waldo Emerson has an essay entitled "Self Reliance". I read it for the first time somewhat recently, and liked it so much that I gave it to all my economics students as a parting reading.  You should read it (21 pages).

Though I'm tempted to point out the irony of Emerson traveling the country and lecturing captivated crowds to rely on themselves and not listen to anyone else, I will.

His essay actually provides an excellent context for me to explain one of my rarely explained and oft misunderstood approaches to the world: my complete disregard for movie reviews.  I don't have much respect or tolerance for movie critics, irregardless of whether their critique is positive or negative.


The release of The Great Gatsby two weeks ago was a pretty big deal in my circles.  How bout yours?  That just made me realize something...my "circles" are basically teachers and students.  Who am I?

What's the big deal with movie trailers, anyway?  I have so many friends who hunt down every trailer for new movies.  What's the point?

My approach is the opposite.  I'd rather not know what's going to happen before I see it.  Once you know you want to see a movie, why do anything more than wait?  

I don't go to the theaters often. When I do, it's usually to see something I've been wanting to see for a while.  My last several movies minus Gatsby were..., Perks of Being a Wallflower, Start Trek: Into Darkness, Silver Linings Playbook, The Hobbit, Skyfall, in order of enjoyment.  I didn't hate any of them.

Maybe it's just a self-control thing.  Some people deal with the difficulty of waiting for something they want by consuming all the information they can find as soon as they can find it.  I learned early on that comedies often use their best jokes in their trailers, and trailers even depict scenes pretty regularly that don't even make the final cut.  Spending an entire movie anticipating certain jokes, memorable one-liners and particular scenes happening, especially when some of the ones you were expecting never happen, is not my idea of a good time.

I suppose self control is a part of self reliance, but the more obvious connection is still coming.

I make a point not to read reviews before I go see a movie.

WHY DO PEOPLE DO THAT.

If you want to see Movie X, see it.  If you don't, don't.  What I don't want to hear is you second-guessing yourself because of some random critic who typed up their intentionally reactionary reaction.  I mean, I might understand if you're trying to find a good movie, or choosing between several options.  But even then, I would advise looking at the overall rating and not the details.  Extreme claims get attention, but if you take the average review, the law of large numbers says it will be closer to the truth.  Nevertheless, I would never read a review of a movie I know I'm definitely going to see. It's worse than a waste of time.

If I know anything about the human mind, I know if I tell you something specific I liked or disliked about a movie before you go see it, it will affect your experience.

"Man, Bane's voice was really over-the-top ridiculous.  Almost as ridiculous as Batman using that absurdly gravelly voice way beyond the point when EVERYONE KNOWS BATMAN IS BRUCE WAYNE."

How does that comment not affect your experience of Dark Knight Rises?  It's basically a filter that you are now forced to watch the movie through.  Coming out of the movie, your opinion will either agree with or reject mine.

It's kinda like this sign.

Because I put this in your field of vision, now you either have the urge to touch the sign (which you wouldn't have if I didn't show it to you), or you intentionally decide not to touch the sign (which you wouldn't have if I didn't show it to you).  My action forced your reaction.

Reading a review is the same.  Most times it's unavoidable, so why not avoid it when we have the option?

On a related note, The Great Gatsby had a 48% on Rotten Tomatoes the weekend of its release.  That is silly.  I have a theory to explain it.

I just finished reading The Phantom Tollbooth — a text our kids read in fifth grade.  It was recommended to me, and I liked it (didn't read any reviews beforehand, though).  Consider this quote:

"My goodness," thought Milo, "everybody is so terribly sensitive about the things they know best."

That sums it up, doesn't it? Why books turned to movies generally don't do well, with Gatsby being the most recent example.  Those are the only instances where a large percentage of the audience (and EVERY critic) comes in with a set opinion and expectations already formed.  Everyone who has read the book considers themselves a legitimate critic, and has the confidence to follow through with criticism.  If we don't have an opinion/expectation coming in, we are far less likely to come out with a negative opinion.

And the "real" critics!  These people's horses could not be higher.  If the movie adaption doesn't match their particular interpretation, they initiate lambasting.  The problem is, the appeal of quality novels is their openness. You can't make a successful (mainstream) movie as ambiguous and open to interpretation as the original book; you just can't (especially if the primary plot mover is internalized).  And Baz Luhrmann was certainly attempting to make a mainstream movie.  If fact, if you watch his interview on the Colbert Report, you'll see how proud he is that The Great Gatsby sold more copies in the week before the movie opening than sold in Fitzgerald's ENTIRE LIFE.  Sure, it's not the ideal adaption, but it created a world where more people read F. Scott Fitzgerald, and that is better than it not happening.

By the way, if you don't have strong feelings about Carey Mulligan, you might after watching this clip.

I'm not saying I totally disregard movie reviews, I just refuse to "like" or "not like" something because some stranger told me to.  Once I've seen the movie and decided what I think, I'll read a few reviews.  My goal is to see how closely my opinion lines up with the critics.  They often have insight that I find useful, and observations I hadn't considered before.  And so, over time, my initial impression becomes more and more informed, balanced and, well, good.

But I'm not about to burden you with my actual review.

Save / Invest

--------------------------------------------------------------------------------

Dear mom,

This entry is dedicated to you.  You gave up your veterinary practice to homeschool me for my first 13 years.  You taught me how to read, and you taught me how to think for myself.  In addition to everything else, you're probably the only person who reads all of my blog posts.  Thanks.

Love,
Nathan
--------------------------------------------------------------------------------

I recently finished teaching a week of Game Theory in my economics class.  Game is my favorite type of theory, and economics is my favorite type of class.  When I gave them the test, I added a little section at the end which I called a "Bonus".  It was a bonus, but it was also a game theory experiment, a mind game, and the outcome in an indicator of how much faith we should have in humanity.  Here it is:

BONUS

1. You have a free bonus point right here in your grasp (+1).  You can choose to keep it, or invest it.  If 85% or more of the class invests, each investor will gain an additional bonus point.  If less than 85% invests, each investor will lose their bonus point.  If you save it, it’s guaranteed.  Circle one.

            SAVE                                                   INVEST

Now, what is the most desirable outcome of this game?  Let's break it down.  It's simple.

                    Everyone Else (>85%)

                  Save              Invest

       Save    1, 1                1, 2

You

      Invest   0, 1                2, 2

The point value before the comma is what "You" get, the one after is what "Everyone Else" gets. Is there any additional information you need?  It IS important to know that my class isn't graded on a curve.  It can't help your grade to hurt someone else's, and theoretically everyone could finish with A's.  Another way of looking at it is that all the students are competing against me (no curve), as opposed to each other (curve).

Given a non-competitive environment, what is the best decision?  Keep in mind that these are students who probably have a better understanding of cost/benefit than the typical high school sophomore.  The best outcome is clearly that everyone invest.  When I say clearly, I mean it's as clear as the answer to "Would you rather have one bonus point, or two? No, this isn't a trick question." 

The students had a tad more information than you do.  They knew how many of the fellow game-players had to invest for them to gain that extra extra point (and when I say they "knew", I mean they had access to that information).  For both of my sections of 16 students, the magic number was two.  They could have up to two people save, and the rest of the 14 would still be safe to invest.  If three or more saved, the investors would lose their investment.  They also knew the characters/personality of other players in this "game", which could turn out to be a positive or a negative, depending on the other players.  

To review.  Asking what outcome is best is the same as asking which outcome results in the highest total of bonus points.  Well, "all invest" equals 32 total bonus points, "all save" equals 16 bonus points, and the worst-case scenario?  Three save, 13 invest.  THAT results in three total bonus points.  So we could end up anywhere from 3 to 32 bonus points.

With me so far?

Great! I trusted you, really.  It's all those other people I question sometimes.

Last week I did a week on business cycle theory, focusing almost exclusively on the Frederich Hayek vs. John Maynard Keynes debate.  small government vs. big government.  lasseiz faire vs. interventionism.  intentional saving vs. intentional deficits.  solve the boom vs. solve the bust.  human action vs. central planning.  

They are opposite in every conceivable way, yet they both make convincing arguments.  Okay so "opposite" is a slight exaggeration, since Keynes is more towards the center of the big picture spectrum (flanked by Marx on the left and libertarians/anarcho-capitalists on the right).  Here is my off-the-cuff summary...

Hayek says if we allowed individuals to make their own decisions without interfering with their incentives, we would arrive at the best outcome (though he admits there will be less-than-optimal outcomes along the way).  Interference in the market results in false signals, false signals result in malinvestment, and malinvestment can lead to booms (unsustainably "strong" economies).  Booms eventually lead to busts.  

Keynes says we can't trust individuals to make decisions which are best for them in the long run.  He says the fluctuation in the stock markets are based on random & unpredictable elements of the human psyche, calling these irrational impulses "animal spirits".  Since we can't predict them, the best solution is to minimize the busts once they happen.  When people notice the economy is slowing/crashing, they become conservative and hoard their money.  This over-saving leads to an even slower economy, leading to more saving, leading to... he calls this the Paradox of Thrift.  The solution, then, is to replace the lost consumer spending with government spending.  The gov't can provide jobs and stimulate the market, at least until the economy is strong again.  

Is it funny that I'm concerned that one summary is noticeably longer/more complicated than the other? Because of Occam's Razor.  It's concerning to me.  I'm trying to avoid bias.

Their debate is articulately and succinctly stated in this unbiased video. It's 8 minutes.  You don't have to watch it.

When it comes down to it, Hayek has faith in individuals, and Keynes does not.  Keynes thinks he needs to make decisions FOR normal (irrational) people.  

Are you wondering why this post thus far has been on two completely separate topics?

Are you wondering how many students saved and how many invested?

Are you wondering who is right?

Where to begin..

The answer is 8.  Eight students invested, and eight saved.  In both sections!

So both sections received a total of eight bonus points (eight got one, eight lost one), approximately 24 points less than the optimal-and-completely-attainable outcome of 32.  

What conclusion can we draw from this?  As the teacher/dictator, where is the teachable moment?

Well, the students failed to arrive at the best outcome under their own power.  Simply put, Keynes won round one.  I could "guarantee" a better solution by taking away their freedom to make the choice at all. And it's in my power to do so.  Why not?

As we discussed in class later, what's the difference between this situation and, say, passing a law requiring everyone to wear a seat belt? Or, making smoking illegal.  Orrr... even more literal, imagine this.  Since, upon retirement, a majority of people wish they had accumulated more money, and, even knowing this, younger people (such as myself) STILL don't put enough way, shouldn't the government force us to do what's best for us in the long run, and divert a percentage of money from our incomes into saving?  If the decision is Spend All  /  Save Some, and the best long run outcome is "Save Some", should we even be left with a choice?  Sound familiar?

Maybe you're still wondering why anyone would choose to save in MY little game.  It comes down to a few things.  First, it matters how you think about the bonus point.  Some people think of it as potentially avoiding losing a point when they save.  The other type of person thinks of it as potentially gaining a point when they invest.  The first type will tend to be conservative, the second embraces risk.  The decision they make in this game would be a somewhat reliable indicator for how risky they are in general (and when I say "somewhat reliable", I mean I would love to track them for the rest of their lives and see what decisions they make and how they turn out).  It's very difficult for each type of person to see from the other's perspective, as they realized during discussion.  Many people strongly prefer avoiding losses to acquiring gains.  It's called Loss Aversion and I'll tell you more about it later.

The thought process the savers described in class was fascinating.  "I was afraid that too many people would save, so I saved."  Translated, "I was afraid that other people would make the worst decision, so I made the worst decision."  They became what they were afraid of, because of their fear.  This lines up perfectly with Keynes theory; he said that uncertainty leads to underinvestment.  

I wasn't finished with the game yet, though.  After we discussed it, I had to try it again.  I'm more than a little obsessed, if you can't tell.  One thing that adds another angle is the concept of a Nash Equilibrium.  In a multi-player "game", a Nash Equilibrium is a stable outcome where you know the payoffs of the other players, and there is no benefit to any one player changing their strategy.  This game has two Nash Equilibrium points.  If everyone saves, no one player can benefit by switching to invest. Similarly, if everyone invests, no one player can benefit from switching to save.  Because either extreme is a stable state, once the players shift in one direction, that shift becomes a self-fulfilling prophecy.  For example, if the second time 6 invested and 10 saved, the shifts in strategy would most likely continue until all 16 saved.  And, once all 16 saved, it would take something special for them to break out of that cycle.  The opposite is true as well.

Thankfully, both sections moved to the better end of the spectrum.  Presented with the same problem, one section had all 16 invest, and the other had 14.  

Hayek wins round two.  

The only difference between round one and round two was education.  This is a hopeful solution in my opinion, because it's attainable.  Education can be fixed; we are fixing education.  Though the government (me, in this case) theoretically has the power to coerce people into choosing "correctly", I could never side with Keynes and endorse an increase in government power.  Everything I've seen, learned, and experienced has reinforced the idea that power corrupts, and absolute power corrupts absolutely.  When you give someone power over you, you are also giving them an opportunity to abuse it.    So, given the choice between taking away freedom or adding education, I'd rather add education.

*Update*
I added this game to the end of my 8th graders' final.  It was the most straightfoward test I gave all year, with the exception of this little mind game.
In one section, they had 5 invest and 17 save.
In the other, 12 invested and 8 saved.

I had predicted the second section would have a higher rate of investment, but I didn't really have a good reason until after the results were in.  Wanna know the reason?

This game is a fascinatingly reliable indicator of how much trust exists in a particular environment.  If you trust your classmates, you are more likely to invest.  If you don't trust your peers, you will save.  This theory is backed up by the fact that the chemistry in the second section is much better than the first.  I predict that this game could predict the degree to which participants in a particular environment trust and respect their "teammates".