Well I guess you must have had a change of heart
You don't treat me like you used to at the start

Those are lyrics from the first song on the album I just bought, Up Front & Down Low by Teddy Thompson. This is the first album I’ve bought through traditional channels for about ten years. That’s when I pretty much stopped buying music. I've bought a few dozen songs directly from independent musicians, but nothing from the recording industry.

Ten years ago the recording industry wasn’t yet extorting money from music fans, but it was already on the wrong side of things. Specifically, it was still pushing the physical distribution model for music (e.g. CDs) even though digital music was clearly the way forward. So I stopped buying CDs and started waiting for the opportunity to buy digital files instead. And amazingly enough, that opportunity took ten full years to arrive.

“What about iTunes?” you ask. Well, until very recently, you couldn’t buy digital files via iTunes. Because of what is known as "digital rights management" or DRM, iTunes really only sells a temporary license to listen to music under very specific circumstances. I’ve always found that unacceptable.

Before digital music arrived, I could take a CD I bought and give it to my friend to listen to. I can likewise take a car I bought and give it to my friend to drive, or — to use a metaphor you’ve likely heard before a movie — take a candy bar I bought and let my friend taste it. I can generally use my purchases wherever I want and however I want, because they’re mine. In this light, music files with DRM are not mine at all. How I use them is heavily regulated by whoever sold them. So I’ve never “bought” them.

Before I stopped buying music I bought probably an average of two CDs a month. So over ten years, that’s about 240 albums I haven’t bought. That may not be enough for the music industry to miss me, but it’s enough that I’ve missed the music industry. So I’m glad we’re having this reunion.

What reunion? The Amazon MP3 Store reunion. Now that I can finally buy music files and own them, I’m buying music again. I’m sure the music industry looks at this as regaining me as a consumer, but I look at it as regaining them as a vendor. I’ve been sitting around online waiting for them to sell me music for ten years and they just finally showed up with something to sell. So welcome back, music.

 

Living in Iowa, it’s hard to avoid conversations about ethanol. And working for an advertising agency that previously represented the ethanol industry and continues to represent ethanol-related businesses causes the topic to come up in conversation for me more often than for the average Iowan even. I use ethanol in my car, as does most anyone who hasn’t put much thought into it. It’s commonly six cents cheaper. Who wouldn’t go with six cents cheaper?

Well, I’ve talked to a few people who wouldn’t go with six cents cheaper. Their logic comes down to efficiency. While ethanol is cheaper, it actually takes your car more ethanol to produce the same amount of energy, so you’re getting few miles-per-gallon with ethanol vs. standard unleaded gas. “Meh,” I told myself, “that’s a worthwhile tradeoff for a cleaner planet.” Then the ethanol dissenters typically suggest that the process of creating ethanol actually creates more pollution. After a few of these conversations, I decided to do some testing and find out the truth by the numbers.

82% of statistics are made up, so I set out to make up my own, in the only context that matters to me: my own car, a 1997 Buick LeSabre. Lacking the resources to test the pollution from my car (much less the processing plant at which my ethanol was produced), I decided to test what I could: the fuel efficiency of ethanol. Over the past couple months I’ve been recording all of my gas purchases, as well as my mileage between them.

The process of figuring out miles-per-gallon was actually a bit confusing to me at first, so I’ll explain it here. When I fill up my tank, I reset my trip odometer. On my next refill, I know how many miles I’ve gone while emptying my tank, and the amount I put in to refill the tank is equal to the amount of gas I must have used while traveling those miles, because a full tank is always the same size. So by dividing those miles by those gallons, I have a miles-per-gallon number.

This gets confusing when testing different types of gas, because the number of gallons on my current fill-up is actually the number of gallons used with the previous fill-up’s type of gas. I repeated this process several times, and attempted to get as close to a full tank as possible to avoid the previous tank skewing the efficiency of the current tank as I switched back and forth between 10% ethanol and 0% ethanol unleaded gas.

So that’s my methodology. Here are the numbers:

Ethanol % Gallons Miles Highway/City Miles-per-gallon
10% 15.056 393.7 Highway 26.149
0% 15.488 359.2 Highway 23.192
0% 14.571 257.0 City 17.637
0% 15.813 416.6 Highway 26.345
10% 14.923 370.3 Highway 24.814
0% 11.318 293.5 Highway 25.932
0% 16.497 371.0 City 22.488

Notice that I added a Highway/City driving variable to the data. I quickly noticed that my numbers weren’t nearly as steady as I was expecting, and I believe my hunch that this variance is primary due to highway vs. city driving is borne out by the numbers above. So the first conclusion is that any variance in efficiency between ethanol and non-ethanol gas is much smaller than the variance between city and highway driving. Those of us concerned about fuel-efficiency need to be working to make our cities more hospitable to walking and biking more than we need to be debating the merits of ethanol. Nonetheless, on to debating the merits of ethanol.

It’s clear to me from the numbers above that ethanol is indeed less fuel efficient than non-ethanol gas in my car. However, the difference is very slight, and it is more than offset by the standard price difference of six cents per gallon. Figuring that in, the average miles-per-dollar figures (for highway miles only, as I’m still finishing my tank of city-driving ethanol) are: 12.74 for ethanol and 12.21 for non-ethanol. So despite the lower fuel efficiency of ethanol, the price difference means that for every dollar I spend, I’m going more miles by using ethanol in my car. With this in mind, I intend to continue using ethanol.

But what about the pollution? Well, I’m not sure about the pollution. I haven’t seen any actual numbers on that, so all I have to go on is what other people say they heard somewhere. Some people say ethanol is better than non-ethanol gas for the environment overall (notably a former client of my employer says this quite often), while others say it’s worse. If anyone has any numbers on this, I’d be interested to see them. But lacking any testable numbers, it seems to me everyone is just arguing whatever reinforces their own beliefs.

And yes, I’m aware that dark forces (e.g. Archer Daniels Midland Company) are at work making corn an artificially prominent part of the American (and increasingly world) economy in everything from ethanol to high fructose corn syrup to construction materials. And maybe when I’ve finished reading Omnivore’s Dilemma this will be enough to convince me to act against my own immediate economic interests. But for now, I’m sticking with the six cents cheaper at the pump and the half a mile-per-dollar more on the road I get with ethanol. As the standard disclaimer says, your mileage may vary, and I’d encourage everyone to do their own testing in their own cars.

 

Spam (unsolicited commercial email) is a major problem in general, attracting various people to suggest solutions of all sorts: technical, legal, social, etc.. But few of these solutions get to the root of the problem: spam remains profitable. Most of the purchases intiated via spam are done in anonymity, so unfortunately we can’t do much to prevent people from buying various products and services from spam peddlers.

Stock spam, emails encouraging people to invest in a specific worthless stock, is on the rise, and the BBC has a story on why. Short story: quick profit. I wonder if stock spam doesn’t offer unique opportunities to solve the problem at the root. First, can’t we track down the people buying these stocks through public financial records, and call them out for public shaming? And second, I don’t know much about stock trading, but couldn’t we short-sell these stocks, reduce their value, reduce the profit for stock spammers, and possibly even take a bit of profit in the process?

None of this will work for other types of spam, but am I missing some reason why these methods won’t work to combat stock spam?

 

As I move projects to MakeDataMakeSense.com, I’m giving everything a pretty icon and otherwise trying to make it look more "professional," under the theory that people are more likely to pay attention to something that looks like it might be for sale. And this is apparently working as evidenced by one project now listed in the Museum of Modern Betas as a "beta by inheritance." I guess I just need to tack a meaningless "beta" icon on everything to complete the sell-out process (without actually selling anything).

 

In these days of widespread corruption and bribery, it is important to remember that no, this is not how our great democracy is supposed to work. The bribery is supposed to be much more subtle -- not to mention legal.

Aaron Swartz

 

Feed Rinse appears to do what my RSS filter has done for about two years, only better, prettier, and for money. This seems to be a recurring theme with my projects. I continue to be surprised by what people will pay for. But maybe that's a good thing.

 

I just sent the following to an email list that has recently been discussing various anti-spam technologies:

Spam is fundamentally a social problem, not a technological problem. No amount of clever technology can end spam as long as there are still significant numbers of people out there who indicate through their purchases that they want to receive spam. The BBC reports: According to a survey conducted by security firm Mirapoint and market research company the Radicati Group, nearly a third of e-mail users have clicked on links in spam messages.

Imagine it costs $100 to send a million spam messages (though it doesn't cost nearly that much), and each message is selling a product with a $20 markup. Only six of those million messages need to get through to a willing consumer to keep spam profitable. And those six people will never be using Bayesian filters or whatever other nifty tools we can come up with, because they don't even recognize a problem with spam. And those six people will also never self-identify, because they are embarrassed about their purchases.

So spammers can only reach them through mass emailing, and the rest of us suffer the consequences. I don't know of any current anti-spam technology that does anything to deal with those six people.

I'd like to see more economists and sociologists look at changing the factors that make spam the most desirable way to purchase certain products. Why do people buy propecia via spam rather than at their local pharmacy, and what could be done to change that? I think that's a more useful question to answer than how to quickly recognize "v14gr4" as a variant of "viagra."

 

In a comment to my post on microlending, Jessica asked what I thought about an organization that does what might be called microgiving, giving people animals that grow to be more valuable than they were when given. I'm all for charity in general, but there are several reasons why this would probably work better if the animals were replaced with loans. Loans are better than giving, despite the cliche about not borrowing and lending.

Local knowledge is better than a plan to save the world. Animals aren't the best use of money in all places at all times for all people. The theory behind microlending, largely proven in practice, is that people know what their local community needs, and they just need some capital to provide it. Maybe their local community needs animals. But maybe it doesn't. I remember a story - I don't know the source or if it's true - about a charity that gave cars to poor people, who then sold the cars and bought bus tickets. This ties into the next issue:

Shared responsibility is better than individual responsibility. If I give you a dollar, you are only responsible to yourself in how you spend that dollar. You may want to spend that dollar in the most beneficial way possible, but you may not know what that is, and even if you know, you might not be listening to yourself. You could easily be tempted to spend it on a short-term gain at the expense of a long-term investment. If I loan you a dollar, we have a shared responsibility for how that dollar is spent. We are both responsible to ourselves, but also to each other. Shared responsibility is multiplied, not just added. And when an organization stays around for a while, this responsibility gets multiplied even further over time. Which ties into the next issue:

Individuals are less likely to reinvest than organizations. Reinvestment is good. If I give you money, your wealth has grown. But you won't likely give money to someone else. If I loan you money, your wealth grows, and then you give the money back to me, and I can give it to someone else. And over time, I can give money to more and more people. Reinvestment build infrastructure which improves community. And now that I think about it, this is a problem with Kiva, the direct-microlending organization I wrote about earlier, because the individuals doing lending through Kiva are less likely to loan again than Kiva would be if it were handling the loans.

Another issue is the relationship created by giving vs. lending. We give down, to people who have less than us. We lend to peers and make them our partners in investment. This is a bit counter-intuitive, but I think it's true. Personally, I don't like to borrow money from people, but I like even less to take money from people. And then, of course, there's the cynical view that poor people are just lazy, which microlending preempts and microgiving doesn't.

So in general I think microlending is better than microgiving. That said, if you want to donate directly to people, go ahead. It couldn't hurt. I think microlending is a smarter way to redistribute wealth. But the world, in my opinion, is not currently lacking in smarts so much as compassion. I should also point out briefly that most of the principles I've described here don't hold true on a larger scale. I favor macro-giving over macro-lending, but I'll go into that some other time.

 

I recently added some advertising for a few charities to this site. One of the charities is the Grameen Foundation, a microlending institution. I have a BA in International Studies, and much of what I did to earn that degree was learning about various save-the-world plans and their pros and cons. After four years, I pretty much knew why the world would never be saved, because pretty much every save-the-world plan has some major problems. Except the Grameen Bank.

The Grameen Bank gives small amounts of money to people in developing regions, which they then invest in what they need to sustain themselves, and pay back the money. Just like any loan, not everyone pays back the money, but it's not a lot of money, so no big deal. And those who do pay back the money gain both capital and experience helping themselves, which is ultimately much more valuable. It's generally an excellent program, and you can contribute to it via the Grameen Foundation.

Today Seth Godin pointed to Kiva, which does the same kind of micro-lending as the Grameen Bank, only without the bank. Rather than give your money to the Grammen Foundation, you give it directly to the people who need it. I have mixed feelings about this.

At first glance, it appears this direct connection primarily benefits donors, who get to know exactly where the money is going. I also imagine this system requires more overhead than Grameen. But it's also more transparent, which is something all non-profits should strive for. And even if it does primarily benefit donors, that should bring in more donors and ultimately benefit recipients. I think I'll give Kiva a little more time to establish a history before giving it my coveted banner ad endorsement, but it's nice to see new activity in microlending.