Monday, November 11, 2019

Weapons of Math Destruction

The post title is the title of a wonderful book by Cathy O’Neil. I can’t believe I haven’t blogged about the book before. She outlines how artificial intelligence in the form of algorithms often have unintended consequences, like sentencing of criminals based on biased perspectives. The algorithms are only as wise as the programmers, and often reflect biases of the programmers. Even today, there’s news that Apple’s trademarked credit card may have a sex-bias granting higher credit limits to males with lower credit scores than their female partners. Also, Marketplace ‘radio’ host, Kai Ryssdal, interviewed the author of “You Look Like a Thing and I Love You”, a new book about AI, wherein they demonstrated that despite lots of ‘learning’ about how people and cats appear, computer algorithms can’t accurately depict or create a picture of these living creatures.

They and I worry about driverless cars. If computers have trouble recognizing objects, legitimate hazards may go undetected while false positives (i.e. an non-hazard is identified as a hazard) generate evasive action, endangering other vehicles on the road. Likewise, if the algorithms depend on accurate signals, how well do sensors work during inclement weather? I’ve had the opportunity that radar sensors for making cruise control decisions became unavailable for use during blizzards.
They all work well during fair weather. And all algorithms can be objective if they’re built without biases, presumptions and really, really good data. As Taleb says in “Black Swan”, in order to predict the future we have to have perfect insight into the past in order to fully understand the cause and effect of the circumstances that ‘created’ our current situations. Will we ever be able to load all of the relevant data to make great decisions, not merely the significant data? Remember the scandals of the price with online shopping sites when pricing algorithms went ‘crazy’ showing prices that were insanely inflated over normal based on perceived demand and customers’ sense of affordability (i.e. how wealthy they were)?

I’m not saying algorithms are bad nor that AI won’t happen but it may be a while. Especially if a dearth of data isn’t the problem but how well it can be analyses to give great answers, not just good answers. I’ve seen presentations where AI is used to augment physicians’ own diagnostic powers through visual analysis of tumors and other physical symptoms. But note my emphasis of augmentation, not replacement. Even some other applications (like identifying guns) need human assistance (i.e. re-interpretation).

Thursday, October 24, 2019

Business People in Politics

Donald Trump touted his business acumen as a benefit to be the Chief Executive of the country. He said he was a deal maker: that hasn’t really happened. Most of his accomplishments were through Executive Orders without negotiating with both chambers of Congress. Only one trade deal has been negotiated—the USMCA—but it hasn’t been ratified by the Senate even though his political party controls that chamber. He has had the highest staff turnover of any President. He may even have the most questionable hires with over 280 lobbyists being added to the government payroll (“drain the swamp” by inviting more alligators) and has had more ‘acting’ heads of departments than almost anyone before. And with his claim of balancing the budget, the deficit has gotten worse. Revenues were flat in the first two fiscal years. It’s estimated to increase this year due to more tariffs being collected from Americans (a ‘trade tax’).

If a CEO had gotten hired by the board of directors based on the ability to increase revenue, cut expenses, hire the best candidates, create joint ventures or mergers and acquisitions...and then not perform, it’s unlikely that the board would retain the CEO.

Trump’s business record has presaged his presidential record. Trump Hotels and Casino Resorts declared bankruptcy in 2004. It’s pretty hard for casinos to lose money. He has defaulted on so many loans, it seems only Deutsche Bank would lend him any money and that’s only after an individual with DB put pressure on the lending committee. He is perhaps the most litigious CEO in history with more than 3500 lawsuits under his name. I guess you might say lawsuits are one way to force others to a bargaining table. [Author’s note: there is one source linked above, but there have been many investigations into Trump’s business dealings such as NPR’s Embedded podcast series, a Netflix series, several books, etc.]

In the 2020 Democratic field, Tom Steyer and Andrew Yang are making the same plea: a business person can get the country turned around and poised for the next decade of economic change. I couldn’t find anything about Steyer’s management style or hiring record, though his deputy at Farallon, the investment company he founded and grew to managing $20 billion, took over for Steyer after his departure having been mentored well enough to keep investors and the board happy. Neither can I find anything on Yang’s executive style. After quitting a law firm, his first tech company went bankrupt during the dot-com bubble of the early 2000’s. His next two seemed to do well. Though both have helped lead successful service organizations, we don’t know anything about their negotiating/deal-making styles, which are important to get Congress to implement policies and laws. When you run a company, you have to negotiate but within the organization, you get to make the final decision. And that’s not the case as POTUS. Also, we don’t know how well they’d attract the best advisory and political talent to their Cabinets and staffs.

Maybe we’ll learn more if those two ever get to be near the front of the Democratic pack. But right now, it’s hard to say if the country could tolerate another business CEO in the top spot.