sábado, septiembre 08, 2018

ONLINE DATING: MODERN LOVE / THE ECONOMIST

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Online dating

Modern love

The internet has transformed the search for love and partnership



THE internet has transformed the way people work and communicate. It has upended industries, from entertainment to retailing. But its most profound effect may well be on the biggest decision that most people make—choosing a mate.

In the early 1990s the notion of meeting a partner online seemed freakish, and not a little pathetic. Today, in many places, it is normal. Smartphones have put virtual bars in people’s pockets, where singletons can mingle free from the constraints of social or physical geography. Globally, at least 200m people use digital dating services every month. In America more than a third of marriages now start with an online match-up. The internet is the second-most-popular way for Americans to meet people of the opposite sex, and is fast catching up with real-world “friend of a friend” introductions.
Digital dating is a massive social experiment, conducted on one of humanity’s most intimate and vital processes. Its effects are only just starting to become visible.

When Harry clicked on Sally

Meeting a mate over the internet is fundamentally different from meeting one offline. In the physical world, partners are found in family networks or among circles of friends and colleagues. Meeting a friend of a friend is the norm. People who meet online are overwhelmingly likely to be strangers. As a result, dating digitally offers much greater choice. A bar, choir or office might have a few tens of potential partners for any one person. Online there are tens of thousands.

This greater choice—plus the fact that digital connections are made only with mutual consent—makes the digital dating market far more efficient than the offline kind. For some, that is bad news. Because of the gulf in pickiness between the sexes, a few straight men are doomed never to get any matches at all. On Tantan, a Chinese app, men express interest in 60% of women they see, but women are interested in just 6% of men; this dynamic means that 5% of men never receive a match. In offline dating, with a much smaller pool of men to fish from, straight women are more likely to couple up with men who would not get a look-in online.

For most people, however, digital dating offers better outcomes. Research has found that marriages in America between people who meet online are likely to last longer; such couples profess to be happier than those who met offline. The whiff of moral panic surrounding dating apps is vastly overblown. Precious little evidence exists to show that opportunities online are encouraging infidelity. In America, divorce rates climbed until just before the advent of the internet, and have fallen since.

Online dating is a particular boon for those with very particular requirements. Jdate allows daters to filter out matches who would not consider converting to Judaism, for instance. A vastly bigger market has had dramatic results for same-sex daters in particular. In America, 70% of gay people meet their partners online. This searchable spectrum of sexual diversity is a boon: more people can find the intimacy they seek.

There are problems with the modern way of love, however. Many users complain of stress when confronted with the brutal realities of the digital meat market, and their place within it. Negative emotions about body image existed before the internet, but they are amplified when strangers can issue snap judgments on attractiveness. Digital dating has been linked to depression. The same problems that afflict other digital platforms recur in this realm, from scams to fake accounts: 10% of all newly created dating profiles do not belong to real people.

This new world of romance may also have unintended consequences for society. The fact that online daters have so much more choice can break down barriers: evidence suggests that the internet is boosting interracial marriages by bypassing homogenous social groups. But daters are also more able to choose partners like themselves. Assortative mating, the process whereby people with similar education levels and incomes pair up, already shoulders some of the blame for income inequality. Online dating may make the effect more pronounced: education levels are displayed prominently on dating profiles in a way they would never be offline. It is not hard to imagine dating services of the future matching people by preferred traits, as determined by uploaded genomes. Dating firms also suffer from an inherent conflict of interest. Perfect matching would leave them bereft of paying customers.

The domination of online dating by a handful of firms and their algorithms is another source of worry. Dating apps do not benefit from exactly the same sort of network effects as other tech platforms: a person’s friends do not need to be on a specific dating site, for example. But the feedback loop between large pools of data, generated by ever-growing numbers of users attracted to an ever-improving product, still exists. The entry into the market of Facebook, armed with data from its 2.2bn users, will provide clues as to whether online dating will inexorably consolidate into fewer, larger platforms.

While you were swiping

But even if the market does not become ever more concentrated, the process of coupling (or not) has unquestionably become more centralised. Romance used to be a distributed activity which took place in a profusion of bars, clubs, churches and offices; now enormous numbers of people rely on a few companies to meet their mate. That hands a small number of coders, tweaking the algorithms that determine who sees whom across the virtual bar, tremendous power to engineer mating outcomes. In authoritarian societies especially, the prospect of algorithmically arranged marriages ought to cause some disquiet. Competition offers some protection against such a possibility; so too might greater transparency over the principles used by dating apps to match people up.

Yet such concerns should not obscure the good that comes from the modern way of romance.

The right partners can elevate and nourish each other. The wrong ones can ruin both their lives. Digital dating offers millions of people a more efficient way to find a good mate. That is something to love.


Geopolitics

Why Russia and China’s joint military exercises should worry the West

They hold a mirror to Donald Trump’s undermining of America’s allies 


 
 


RUSSIA has long feared a Chinese invasion of its sprawling far east. Large Russian armies regularly drill in southern Siberia. This year the exercises are the largest since the cold war.

But what is striking is not just the scale of “Vostok-2018”, but the fact that thousands of Chinese soldiers will take part in them as honoured guests.

To some this looks like the reversal of Richard Nixon’s visit to China in 1972. Back then, America split the big communist powers. Now China and Russia are binding closer to challenge the American order. The parallel with the cold war is imperfect. But the West should worry nonetheless, not least because the exercises hold a mirror to America’s weakened alliances.

Exercises matter both militarily and politically. They help keep armed forces on their toes, and hone new weapons and tactics under realistic conditions. This is especially important for China. It is spending heavily on its armed forces, which have become more assertive, but is alone among the big powers in having had no combat experience in almost four decades. China’s forces have imported Russia’s most advanced missiles and aircraft. They can now absorb the battlefield lessons from Russia’s wars in Georgia, Ukraine and Syria.

Politically, there are limits to the rapprochement. China is the rising superpower; Russia is struggling to arrest its own decline. China’s vast infrastructure investments in Central Asia, part of the Belt and Road Initiative, are displacing Russia in its own backyard. Moreover, Russia’s brash flouting of international norms, including its annexation of Crimea and support for separatists in eastern Ukraine, sits uneasily with China. Russia has all but dropped any pretence of civility with America and Europe; China sticks to the notion of “win-win” relations. Russia arms the Taliban to frustrate America; China seeks to promote a peace deal in Afghanistan.

Nevertheless, Russia and China increasingly share a view of how the world ought to be reordered. They want to reassert the role of states over individuals and civil society, break American alliances and establish “harmonious” (ie, servile) arrangements with countries in their orbits. Both have blocked international action against genocidal and despotic regimes, such as those of Syria and Sudan.

Although Russia and China may never be firm allies, their partnership is bad news for liberal democracies everywhere. How to respond? The temptation is to try to play one off against the other. Chinese analysts, who love a conspiracy, devoured reports, later denied, that Henry Kissinger told President Donald Trump to use Russia to contain China. Others think partnership with China is more important. This is the wrong way to see the problem. America has many friends, mostly democracies, which can help it stand up to both Russia and China. Alas, Mr Trump is treating America’s friends badly.

Compare President Vladimir Putin’s deft military diplomacy in Vostok-2018 with Mr Trump’s capricious cancellation of joint exercises with South Korea—to the dismay of his generals. Japan frets that its military ties with America will become a bargaining chip in trade disputes (see article). And although Europeans are relieved that last summer’s NATO summit passed without a crisis, Mr Trump’s disparagement of allies, whether big countries like Germany or small ones like Montenegro, has frayed transatlantic bonds.

The world’s democracies, led by America, should be mounting a collective defence of liberal values. Instead Mr Trump is busy wrecking them. He should learn one lesson from Mr Putin: friends are an asset, not a burden.


Wells Fargo’s apologies leave customers unmoved

There is a message here for companies trying to shrug off a hit to their reputation

Ben McLannahan




You may have missed the latest gaffe from Wells Fargo, the huge US bank laid low by a fake-accounts scandal that broke almost two years ago. This month, in a section of a 173-page securities filing entitled “Additional Efforts to Rebuild Trust”, Wells admitted that due to a computer glitch that ran undiscovered for about five years, more than 600 customers who might have qualified for easier terms on their mortgages did not get them. Of those, about 400 went on to lose their homes.

The bank’s share price barely budged, but anti-Wells outrage picked up again on social media.

There is a message in here for any big company trying to shrug off a hit to its reputation: however much you may think you are done with the past, the past is not done with you.

The San Francisco-based bank wants to put an end to a mostly grim run since September 2016, when it emerged that employees straining to hit sales targets enrolled millions of customers in accounts they neither needed nor wanted. Since then, Wells, which is the US’s fourth-largest bank by assets, has booted out several top executives, reshuffled its board and scrapped the incentives that led staff to bend or break rules.

Yet the bad news has kept coming: problems with mortgage and car-lending operations, the repossession of service members’ cars, a wealth management probe and refunds for add-on products including pet insurance. In most cases, Wells has volunteered that it fell short as part of a commitment by Tim Sloan, chief executive, to notify the public when the bank discovers lapses that harmed consumers.

“Rebuilding trust with our team members, customers, communities, shareholders, and regulators remains our top priority,” says Ancel Martinez, a spokesperson. “As part of our work to transform Wells Fargo, we are committed to closely examining every part of our company, fixing the issues we find, and making things right for all of our stakeholders.”

But Wells’ problems have run so deep that overhauling its hard-charging, meet-the-numbers-at-all-costs culture takes time. Managers are replaced but often the changes are not a clean break. Take the new, Charlotte-based chief operational risk officer, appointed this month. Mark Weintraub spent four years as an executive audit director in Wells’ consumer lending division and did a short stint in consumer banking.

This isn’t like the “London Whale” episode at JPMorgan Chase six years ago, when a trading unit that lost $6.2bn was shut down and the bank moved on, says Erik Gordon, a professor at the University of Michigan’s Ross School of Business. He notes that many of Wells’ 260,000 or so employees thrived in the old culture, or at least got used to it. “You’re mostly working with people who built their careers based on doing things the old way,” he says.

Mike T, a former personal banker at Wells who worked in a branch just outside Philadelphia, says the aggressive sales culture was all-pervasive. He left last year because he was dismayed that so many of his colleagues who bent rules were being promoted ahead of him. He says that a district manager ordered him to target (mostly Mexican) workers who were employed over the road, on a year-long refurbishment project at a huge shopping mall. Whenever a worker sought to cash his pay cheque at the branch, he was made to sit down with a banker to discuss a new set of accounts before being given the money. “[Managers] joked that I should wear construction boots and a hard hat to work,” he says.

In May of this year, Wells tried to reset the clock, taking out double-page adverts in US newspapers claiming that the bank had been “re-established”, 166 years on from its birth. A series of stirring video spots on YouTube — featuring panting horses and rugged cowboys — supported the idea that, yes, the bank let down its customers in all sorts of ways. But, the ads implied, we’re different now. You can trust us.

That is easier said than done. Ian Byrne, an analyst at TickerTags, a Dallas-based company that mines social-media posts for clues on consumer sentiment, says there are parallels between Wells and Facebook and Uber, two Silicon Valley companies which were running apology ads at about the same time. Facebook was trying to convince people it had learnt from the furore over the use of customers’ data by Cambridge Analytica, while Uber was seeking a clean slate after corporate turmoil and attacks on its culture.

In no case, Mr Byrne says, did the ads significantly improve the mood on social media. For Wells, there was only a modest uplift in sentiment in May. By June the readings were sinking again and after the early-August disclosure on mortgage modifications, the percentage of negative posts topped the levels in September 2016 — although on much lower volumes.

“These companies are all running ads . . . saying how much they’ve changed. But consumers are saying, ‘OK, we don’t really believe you’,” says Mr Byrne. Saying sorry is one thing. But scandals are only over when customers say they are over.


A Bearish Summer Ends In Gold - What Next?

by: Andrew Hecht



- Gold broke a pattern of higher lows during the vacation season.

- The yellow metal is sitting at under the $1200 per ounce level with the Indian wedding season starting next month.

- Gold mining stocks followed the precious metal lower.

- The inflation versus higher interest rates conundrum in the gold market.

- Central banks continue to load their vaults with gold.
     
    
The summer of 2018 was a bearish period for the gold market, and it came out of the gate in September after the long holiday weekend with selling pushing the active month December futures contract on COMEX below the $1200 per ounce level once again.
 
A stronger dollar and the prospects of two interest rate hikes by the Fed in the U.S. by the end of this year have weighed heavily on the price of the yellow metal. Gold is a bellwether commodity that typically appreciates during periods of fear and uncertainty and when inflationary pressures begin to nip at the heels of an economy. Given the state of the geopolitical and even U.S. domestic political landscapes these days, the potential for events that would send investors flocking for safe-haven assets like gold remains high. At the same time, inflation has risen to the central bank's two percent target rate. However, the precious metal has ignored any potential reasons for a rally and instead has been making lower lows. Over the summer of 2018, the price action in the gold market destroyed the bullish pattern of higher lows that had been in place since December 2015.

Gold broke a pattern of higher lows during the vacation season

Gold had a rough summer as the price fell below levels of critical technical support.
 
Source: CQG
 
 
As the weekly chart highlights, in July, gold fell below support at the December 2017 low of $1236.50 per ounce. In August, the $1200 level gave way on the nearby COMEX futures contract, and the price fell to a low of $1161.40, the lowest price for the yellow metal since January 2017. Open interest at 466,584 contracts at the end of August was at the low end of the range for the metric for 2018. The slow stochastic, a momentum indicator, declined to oversold territory as a result of the downward trajectory of the price in July and August. While the price of the precious metal closed the month of August at just over the $1200 per ounce level, it moved back below on the first trading session of September. Perhaps the most significant factor when it comes to the price of gold has been the level of the U.S. dollar. When the dollar index rose to its highs of 2018 in mid-August, gold fell to its low. The correction back to the 95 level on the dollar index at the end of last week sent gold back over $1200, and a rally on the first session of September took it back below the round number.
 
The yellow metal is sitting at under the $1200 per ounce level with the Indian wedding season starting next month
 
Supply and demand fundamentals in the gold market is often a more complicated analysis that meets the eye. Central banks around the world hold a substantial percentage of all of the gold ever mined in the history of the world. Central bank reserves of the yellow metal are typically immobile as they sit in vaults within the borders of nations, and at central depositories for official sector reserves in London, Zurich, New York, and some other cities around the globe.
 
Gold has industrial uses because of its physical characteristics, but most demand each year comes from the fabricated, or jewelry sector. On the supply side, two of the biggest gold producing countries in the world, China and Russia, have consumed domestic output to build their reserves. The path of least resistance for the price of gold each year is a function of investment demand. The weakness in the gold price over the recent months is likely a result of the tepid state of investor buying.
 
As we enter the month of September, we are now one month away from the start of the 2018 wedding season in India. In the world's second most populous nation, tradition dictates that a dowry from the bride's family is a gift to the groom. Therefore, as the season approaches each year, investment demand for both gold and silver tends to rise. With gold close to its lowest price of 2018, it is likely that we will see more buoyant demand for the yellow metal in the coming weeks and into October which could support the price of precious metals. However, it has been the direction of the dollar that has been the most influential factor in the gold market on a daily basis. The dollar index rallied from the 95 level to almost 95.4 on the first day of September, and that triggered another round of selling in the gold market on September 4.
 
Gold mining stocks followed the precious metal lower
 
Gold fell to a new low for 2018 in May, it declined below the December 2017 in July, and below the $1200 level in August. However, gold mining stocks only fell to new lows for this year recently.
 
Source: CQG
 
 
As the chart of the VanEck Gold Miners ETF (GDX) shows, it waited to fall to a new low for the year in August. However, after its push to a new and lower level for 2018, it continued lower closing at $17.87 per share on Wednesday, September 5, the lowest price since back in February 2016.
 
Source: CQG
 
 
The price action in the VanEck Junior Gold Miners ETF (GDXJ) followed a similar path as it did not fall to a new low in 2018 until August. Meanwhile, on September 5, at $26.87 GDXJ was trading at the lowest price since March 2016. Gold mining shares were not a leader in the recent bearish price action in the gold market; it was a follower.
 
The inflation versus higher interest rates conundrum in the gold market
 
Rising interest rates in the United States have lifted the value of the dollar against the euro and other world currencies since the February low on the dollar index futures contract. A higher dollar and rising rates are a bearish combination for the price of the yellow metal. The long-standing inverse correlation between gold and the dollar has weighed on the price of gold and many other commodities. Higher rates increase the cost of carrying inventories and long positions which can also create selling pressure.
 
Meanwhile, interest rates in the United States are rising because of economic growth and the rise of inflation to the Fed's two percent target rate. Gold is also an effective barometer of inflationary pressures which eat away at the value of money. While the dollar has appreciated against other world currencies over the recent months, rising prices tells us that higher inflation is gradually eating away at the value of all money, including the dollar. The U.S. currency may be the world's strongest fiat means of exchange these days, but that does not mean that all of the currencies are not losing value and the dollar is the strongest instrument in a sector where all members are suffering from a decline in value.

Many participants in the gold market are watching the dollar rise alongside inflationary pressures with a central bank increasing short-term rates to battle the potential impact of inflation. While the kneejerk reaction is to sell gold, the long-term effects of inflation on the gold market could turn out to be supportive of the price of the yellow metal. If the Fed's two percent target rate is only a brief stop on the way to higher rates of inflation, gold will eventually take note of the rise of the economic conditions and buying will return to the market.
 
Central banks continue to load their vaults with gold
 
Even though the price of gold has been falling steadily since the April high at $1365.40 per ounce and found its most recent bottom at over $200 below that level, the official sector continues to be a net buyer of the yellow metal. Perhaps the most significant addressable market for gold is the world's central banks, monetary authorities, and governments. The official sector holds around 18 percent of all of the world mined in the history of the world. China and Russia, two countries with gold holdings that are well below the levels of the United States, Europe, and other nations on a percentage of total reserves, are building their holdings. The IMF classifies gold as a foreign exchange holding which means that the governments of the world believe that gold is a means of exchange just like the dollar, euro, yen, and other freely convertible world foreign exchange instruments.
 
Individual investment demand is the most significant factor when it comes to the price path of the yellow metal each year. However, the official sector continues to buy the yellow metal on price weakness which will stem the price fall over the coming weeks and months.
 
Meanwhile, many factors on the global economic and political landscapes could cause fear, uncertainty over the coming weeks and months, not to mention the rising level of inflationary pressures.
 
The bearish summer came to an end at the end of August in the gold market, but it continues to decline on the first day of September as the dollar rallied. Since April, the price of gold has declined in the past sixteen out of twenty-one weeks. Below the August low, the next level of critical technical support for the yellow metal stands at the December 2016 low at $1123.90.
 
Below there, the only thing that stands between the yellow metal and a bearish abyss below the $1000 level could be the December 2015 bottom at $1046.20. Gold has taken out the 2017 low, and time will tell if the two other support levels are in jeopardy. I will be watching the buying activity from the world's central banks as the price remains close to the lowest level of this year.

The path of least resistance for the price of gold continues to be lower, but it has declined to oversold territory on the weekly chart. The bullish impact of the Indian wedding season and official sector demand faces a strong dollar and rising interest rates to control inflationary pressures in the United States.
 
Right now, the bears are winning the gold battle, but that could change in the blink of an eye if fear and uncertainty about the future return to the markets over the coming weeks and months. I addition to gold, I favor the gold mining ETF products GDX and GDXJ when gold shows signals of a bottom. I am still standing on the sidelines in the yellow metal but prepared to pull the buying trigger with a tight stop on signs of a bottom to the bearish trend that has been in place since April.

Why Middle-class Families Can No Longer Afford America

Fist of Cash
         
 

Squeezed Book Cover

Alissa Quart, executive editor of the Economic Hardship Reporting Project, hopes readers will take her latest book, Squeezed: Why Our Families Can’t Afford America, as a call to action. Her examination of the disappearing middle class shows that the American Dream is in jeopardy. Saddled with college debt, rising housing costs and fewer well-paying jobs, younger Americans aren’t able to live or save like their parents once did. But there are solutions, Quart says.

An edited transcript of the conversation follows.

Knowledge@Wharton: There’s a great statistic at the outset of the book: Middle-class life is 30% more expensive than it was 20 years ago. What is the greatest concern regarding this problem of affordability in America? 
Alissa Quart: The main problem is the cost of housing — at least that’s what I found from my research and interviews — especially in places like San Francisco, Los Angeles and New York City. The second problem was the cost of daycare. A lot of it had to do with wages that were just not keeping up with other kinds of expenses — [individuals’] own student debt and then the cost of their children’s educations.
Knowledge@Wharton: Why has the cost of housing become such an issue?


Quart: In some of these desirable places, real estate is no longer a place to live, but it’s an investment vehicle. That has driven up the cost of housing for ordinary people or the precarious middle class, as I call them. And it makes a lot of places that are desirable cities practically unlivable.

Knowledge@Wharton: But a place like San Francisco also has Silicon Valley, which pays the kind of wages needed to live there.

Quart: Yes, so I think what you need is affordable housing if you’re going to be requiring people to live in these cities that have gone nuts because of Google or other kinds of companies also moving into the cities themselves…. They often have headquarters in the cities. What I advocate in my book is for affordable housing for people like municipal workers and firefighters and teachers. I interview teachers who drive Uber on the weekends and evenings because they can’t afford to get by on a union teacher’s salary in the areas around San Francisco and Los Angeles. 
“In some of these desirable places, real estate is no longer a place to live, but it’s an investment vehicle.”

Knowledge@Wharton: How much do you think we’ve lost the middle class, and do you think it is going to be an incredible challenge to get back to what it was 30 years ago?

Quart: Yes, it is a challenge. Part of what I’m hoping my book will do is open people’s eyes to the ways that they are at risk and precarious, and instead of feeling bad about it and turning it on themselves, they’ll start to vote differently. They’ll start to feel aligned with the working poor, who have long been precarious, rather than identifying with the top 1% or the top 5%.

They’ll start to say, “How do we organize and vote differently and ask for reforms and things like universal pre-K that will help all of us who are vaguely precarious?”

Knowledge@Wharton: You use the word shame in the book. It’s an important word because there are many people who feel ashamed of their financial situation.

Quart: I use the word because I’m very interested in the emotional and existential elements of financial struggle, and also financial victory. I’m interested in what’s going on inside people. [“Shame”] is a word that comes up. People are blaming themselves, saying, “What did I do wrong? I did everything right. I got these degrees. I worked hard. Why is this not coming together?”

I wanted to shine a light on this stigma. There’s also a stigma [around the fact that] you’re not poor, you’re middle class — so how can you complain? There’s an added shame with that, too.

I think that’s the thing that we need to open our eyes to and say, “I’m not ashamed. This is a system failure.” Maybe I do need to live my life a little differently if I’m doing what I love and it’s not paying off, but I also need to start thinking about other kinds of solutions. As a middle class, what can we do differently?

Knowledge@Wharton: Is there an area where you cast the most blame?

Quart: I think we’re looking lately at wealth. There was an article recently about how wages aren’t keeping up, prices are soaring, and who has been profiting from this recent sunshine moment on our economy? It’s all corporate wealth. Obviously, we need to be thinking differently about our so-called tax reform and trying to get some share of this wealth for workers. That’s something that is going to have to start with us by voting differently. But some of it is local. Some of it is activity we can do on a local level. We can vote differently on a local level.

I also feel like people should start mobilizing for these so-called pie-in-the-sky things like better maternity leave. There are laws against pregnancy discrimination; they’re just not enforced.

This is something that people can do in the corporate sector. They can start saying, “We’d better make sure these norms are enforced, that people are not being discriminated against on the job.”

One of the things I keep thinking, and I kind of want to write about this, is that everyone says, “Oh, this is so pie in the sky,” like the universal basic income idea that [Facebook co-founder] Chris Hughes talks about. That would provide an income guarantee for people, especially people who are lower-income, but potentially to larger swaths of the population. Or maternity leave for more than the current 14% of the population of workers.

But the question is, why are these things so out there? Look at #MeToo. Norms around harassment have seemingly changed in the course of a year. Gay marriage passed. These might have seemed strange outliers five years ago. So, my question is, why are we not seeing these meat-and-potato things — like pregnancy anti-discrimination or maternity leave or daycare – as things that could happen?

Knowledge@Wharton: A college education is becoming more expensive. It’s not just the costs associated with going to school, it’s paying off the loans for 20 or 30 years after you’re done.

Quart: It’s true. One thing that was new to me — and I call it the second-act industry — is people whose debt didn’t come from when they were in college. It was from when they were in their 40s and 50s and went back to school because they felt like they needed to be retrained.

They kept being told they need to be retrained, and then they wound up quite in debt. We need to be careful of that, too. Offer free or cheap retraining programs. Have apprenticeship programs more available to adults. Oversee when people are being snookered.

I talked to a guy who is $60,000 in debt for getting retrained with a degree in IT from one of those for-profit colleges. I think it has since been shut down. It was so corrupt, but he didn’t know. I’m hoping if we keep talking about this second-act industry, people will think twice before they enroll in some of these colleges.

Knowledge@Wharton: Many young people are encouraged with a “do what you love” philosophy. That advice isn’t always beneficial. Do those conversations between parent and child need to change?

Quart: Yes. That was one of the things that really affected me and has affected my parenting. I have a 7-year-old who said, “I want to be an artist.” What do you do when they say these wonderful, creative things they want to be?

I used to teach at Columbia journalism school and other colleges, and I would try to get the students to get a job at a nonprofit or an NGO (nongovernmental organization) and then write on the side. I now run an organization called Economic Hardship Reporting Project, and we give grants to journalists who are struggling. Something like 50% of journalism jobs have shrunk since 2005. So, it’s hard to say, “Yeah, go ahead and do that.”

Knowledge@Wharton: How much is the economy influencing the decision-making of the younger generation?
Quart: They’re not having kids at the same rate. They’re not owning homes, either…. They have a partner, maybe. They have ambitions. And they often have these degrees that are incredibly expensive, and they don’t know how they’re going to pay them back.


So, I do think it’s going to change things. One thing we should start talking about is debt forgiveness or cheaper universities and colleges, but also just keeping some of those costs of colleges in check because it’s ridiculous. If it starts to stymie our population and our productivity, that doesn’t seem like a very good education at all, does it?

Knowledge@Wharton: This division between the top income earners and the middle class is growing. How is that affecting living standards in America?

Quart: Under all of these questions is this huge division and this enormous inequality. America has the greatest inequality. There is a lot less mobility than it used to have, too. It’s almost like the mobility piece is connected to the inequality piece. That’s where you start to get people feeling like they can’t live the lives that their parents lived, and it has a chilling effect. Who are we as Americans? We’re supposed to be aspiring and progressing, right? This is the American dream. But when you know you can’t, what does that do to you as a citizen?

Knowledge@Wharton: There was a recent report about the decline in jobs in the gig economy in the last year or two. Doesn’t that indicate an even greater economic problem down the road?

Quart: Yes. This is when you start to think that we need better unions. Part of this thing that has heightened inequality is that corporate wealth and taxation is very unfair to people who are self-employed and on the poorer side. But there’s also the whole question of whether we should start to wonder why there are people who are that wealthy. Should there be people who are that wealthy? What does this do to people who are forced to do these sideline jobs, like these gig jobs? Should they have some ownership of their own gig job?

If you think about unions, 30% of workers in the 1960s were in unions. Now it’s something like 10% or even less. It’s 7% in the private sector. That just heightens it. They can’t fight for their own rights, they don’t own their part of the gig economy, and they don’t have any solidarity in the workplace.

Knowledge@Wharton: You have a chapter in the book that talks about the rise of 1% television. What is that?

Quart: We should be identifying with people who are more vulnerable or as vulnerable as we are, and not the very rich. But so many shows – “Billions,” “Downton Abbey,” “The Crown,” “Ozark” — are all about the very wealthy, and we’re supposed to be identifying with these often morally compromised people. Many of the precarious middle-class people in my book were also watching these shows and using them as an escape. I found it fascinating.


A Better World Is Here

Bjørn Lomborg




SKANDERBORG, DENMARK – It’s very easy to form the view that the modern world is coming apart. We are constantly confronted with an onslaught of negativity: frightening headlines, alarming research findings, and miserable statistics.

There are indeed many things on the planet that we should be greatly concerned about. But fixating on horror stories means that we miss the bigger picture.

The United Nations focuses on three categories of development: social, economic, and environmental. In each category, looking back over the last quarter-century, we have far more reason for cheer than fear. Indeed, this period has been one of extraordinary progress.

Socially, the most important indicator is how long each of us lives. In 1990, average life expectancy was 65 years. By 2016, it had climbed to 72.5. In just 26 years, we gained 7.5 years of life.

A pessimist might suggest this means we have 7.5 more years to be sick and miserable, but this is not the case. In 1990, we spent almost 13% of our life unwell, and that percentage has not increased. And while there is much talk of inequality being worse than ever, on this most vital measure, inequality is decreasing: the gap between life expectancy in poor and rich countries has narrowed dramatically.

In terms of economic development, one of the most important indicators is the share of people in poverty. Far fewer people now live in abject need. In 1990, 37% of all people were living in extreme poverty; today it’s less than one in ten. In just 28 years, over 1.25 billion people have been lifted out of poverty – a miracle that receives far too little attention.

Looking at the environment, one of the biggest killers is indoor air pollution caused by poor people using dung and wood to cook and keep warm. In 1990, this caused more than 8% of deaths; now it’s 4.7%. That equates to more than 1.2 million fewer people dying from indoor air pollution each year, despite an increase in population.

There is a similar trend in many other environmental development statistics. Between 1990 and 2015, the percentage of the world practicing open defecation halved to 15%. Access to improved water sources increased by 2.6 billion people in the same period, to 91%. More than one-third of the world’s entire population gained access to improved water.

The improvements do not stop there: the world is more literate; child labor has been dropping; we are living in one of the most peaceful times in history; and the majority of the world’s governments are democratic regimes.

Max Roser of Oxford University has built a comprehensive website to explore data like these.

He strikingly suggests that we could think about these quarter-century changes in terms of what happened over the past 24 hours: seen this way, just in the last day, average life expectancy increased by 9.5 hours; 137,000 people escaped extreme poverty; and 305,000 got access to safer drinking water. The media could have told each of these stories every single day since 1990.

But good news is not as newsworthy as bad news. That is not just the media’s fault. It’s more challenging to tell a positive story. In many cases, the “news” isn’t that something has happened, but that a bad thing is no longer happening. It doesn’t capture our imagination in the same way. An intriguing 2014 study found that even when participants stated that they wanted to read positive stories, their behavior revealed a preference for negative content (a preference they didn’t even realize).

We should all challenge ourselves to pay more attention to the positive facts. When people are asked if living conditions around the world will be better in 15 years, 35% believe they will be, and 29% think they will get worse – essentially a toss-up. But among people who understand that many things on the planet already are better than they were, 62% believe in progress. That share drops to just 17% among those who don’t know the facts. The belief that everything is getting worse paints a distorted picture of what we can do, and makes us more fearful.

Consider the fairly common scenario in which politicians and the media whip up fear of crime, even when statistics show national crime rates are low or falling. Attention and scarce resources can end up being devoted to solving the wrong challenge, and we get more police on the streets or reduced civil liberties, rather than more welfare-enhancing – but less newsy – policies like improving pre-schools or health care.

While getting the facts wrong can easily result in misguided, fear-based policies, a more balanced, fact-based recognition of what humanity has achieved enables us to focus our efforts on the areas where we can achieve the most good (often where we are already doing well). This will ensure that the future can be even brighter.


Bjørn Lomborg, a visiting professor at the Copenhagen Business School, is Director of the Copenhagen Consensus Center, which seeks to study environmental problems and solutions using the best available analytical methods. He is the author of The Skeptical Environmentalist, Cool It, How to Spend $75 Billion to Make the World a Better Place and The Nobel Laureates' Guide to the Smartest Targets for the World, and was named one of Time magazine's 100 most influential people in 2004.