Miscellaneous

Obviously, I dropped the ball on this blog. I anticipate preparing
five or six more "Thoughtful Thursdays" over the next year. And sending out
more of these miscellaneous postings.
I have been focusing my
writing energies this semester on the complete Requirements Document for the
Constitutional Construction Kit
The next Thoughtful Thursday is from that effort.

Hack for Egypt

The Hack For Egypt , as part of Cloud Camp 2011, has proposed
a "crowdsourcing" project for the new Egyptian Constitution.
They are looking in the future at a crowdsourcing for the Bill of Rights in
that Constitution.
This is a much less ambitious proposal than the one I am working on. one needs
a simulation component where the Egyptians.
The Egyptian unemployment
is concentrated among the young, as it is in
many other countries including the Arab world.
And 50 percent of educated of
men
and ninety percent of young female
college graduates are unemployed.
So there is a resource of time to work on the Constitution.

Climate Change

I talked about using sortition-based consumption taxes to address
climate change. The Wall Street Journal
had a special issue on Energy and the first article, which frankly
is an editorial, on Climate Change. They say that emissions cuts,
raising energy costs with taxes, cuts economic
activity. Countries do not want
to do this. By putting the tax at the consumption side, this attacks
imports, and tends to get people to consume in ways
that are not energy-intensive.
They may not buy a computer-they may use an internet cafe.
Imports get taxed based on the embodied energy.
They may buy a smaller and more energy efficient house, use public transportation instead of a car.
The article suggest that governments should push for innovations that produce
less costly energy.
Wall Street Journal, November 29th 2010, Page R1

United States Health Insurance Mandate

As I assume all readers of this blog know, the United States has
mandated that all people purchase health insurance. However, there
is some question whether that is constitutional. The famous "necessary
and proper" clause of the United States Constitution gives the
United States Congress the power to make laws "necessary and proper" to
exercising its enumerated powers.
Does mandating that everyone buy health insurance fall within the
"necessary and proper" clause? One District Court has said no!
And it appears that a Florida judge will rule the same way.
However two lower courts said yes, they did.
I made a proposal that would resolve this. Make individuals tax rate
dependent upon their financial responsibility. We already have deductions
for contributing to IRA and for some education items. Individuals who are
purchasing disability insurance, health insurance, education should pay
lower taxes than those who are not.
There are people who cannot be expected
to have money for
health insurance, the single mom putting
herself through Nursing School. However, those who have money
for a flat panel TV or internet, should spend or invest
it some other way such as health insurance.
The New England Journal of Medicine article,
"Can Congress Make you Buy Broccoli? and Why
That's a Hard Question" by Wendy K. Mariner J.D. M.P.H.,
George J. Annas, J.D. M. P. H. and Leonard H. Glantz J.D.
said that Congress had two goals in passing the health reform
it did:

1. 
   provide a way for all Americans to gain health care
2. 
   preserve the private, commercial health industry

Obviously, it is not reasonable to require the health insurance companies to insure anyone regardless of sick they are and let people wait until they are in the proverbial ambulance to buy health insurance.
When a person wants insurance and has a "preexisting condition," we need to distinguish between those who simply waited until they got sick and those that had good reasons for not purchasing health insurance. A bureaucracy cannot. A sortition jury can.
Judge Vinson asked "If the government decides that everyone needs to eat broccoli, can Congress require everyone to buy Brocolli." If Congress chose to expand Medicare or Medicaid to cover everyone, they could have. Congress could then raise everyone's taxes to do so.
I believe at tax time, everyone should compete to show how responsible they are, buying and eating their broccolli, and saving, whether for retirement or their health needs.

Bronte Capital Management Blog

I met Mr. Hammond on the plane to New York City, and then by luck as I walking near 42nd Street in Manhattan. The first article I turned to, was the one on the Australian financial system. There is concern about one of the strategic funds in Australia. More importantly, he discusses the risks with privatized social security of fraud.
There are many other articles there, often very insightfully showing the numbers in investments and securities, from Chinese bus adverts and alcohol sales to Australian Real Estate near the iron ore mining boon.

Benefits Schemes

A gentleman who won two million dollars from the lottery is still collecting food stamps. The food stamp program uses income and lottery winnings is not considered income. State of Michigan is talking about getting a special waiver from the Federal government. (Ron French, Detroit News)
This is why all benefit recipients should go before a sortition jury to eliminate those who don't deserve them, even though they may qualify under the rules.

State Income Taxes

Wall Street Journal, Volume CCLVII Number 70, Page C1 and C2, March 26th to 27th, "The Price of Taxing the Rich" Robert Frank
Million dollar a year incomes pay 45 percent of California's Income Tax receipts. Similarly percentages for Connecticut and New Jersey. The problem with this is that these individuals incomes are erratic. Of course, when the market is up, these people "take their profits." And they have to pay their taxes on the capital gains, and tax revenue goes up. (We saw that when the federal government was briefly in surplus around the turn of this century. But some of this was due to "hundreds of millions in unanticipated tax revenues from taxes on capital gains.") In one year, the top one percent of the taxpayer's income dropped sixteen percent. In 2006, California anticipated a six billion change, either direction, from year to year on a regular basis. In the dot com bust, revenue from capital gains changed from seventeen billion to five billion.
Of course, states can protect themselves with "rainy day" funds. But state governments, like people in general, do not have the discipline to do this.
This blog has long called for salaries and other expenses to be a share of their revenue. Thus States would make goverment salaries and pensions a percentage of revenue. (Note that under the full share economy, government workers and retirees would set their mortgage, rent, etc. as a percentage of this amount. Thus, if this varied fifteen percent a year, they would not be between this decrease and an expense that does not change. Their discretionary income for day-to-day purchases would go up or down by the same percentage as the state's revenues.) And their "borrowing" would be the same way. Thus, rather than selling a three percent bond due in thirty years, they would sell a perpetual bond that paid out nnn percent of the revenue. I earlier called for a "clawback" tax to deal with, among other things, those earning high pensions.
A consumption-based sortition "badness tax" could have firms competing to avoid the taxes necessary to fund the state government.
And with individuals having a share of the income of the companies in which
they invest, there would be less variability of income. Individuals
earn money as the company does, not by selling the shares.

Facts and Factoids about Civil Wars, Thoughtful Thursday

Thoughtful Thursday James Fearon, "Iraq's Civil War" in Foreign Affairs March April 2007, Volume 86 Issue Two and the Wikipedia article on Civil wars.

1. There have been 125 civil wars since the end of World War II--as defined as those leading to over a thousand dead.
2. Another 104 civil wars occurred between 1816 and 1997.
3. Ninety of the Post World War II civil wars killed more than one thousand per year.
4. Nine Civil wars since World War II have killed sixty-thousand or more. These include Iraq. They also include Algeria, Colombia, Guatemala, Peru and Sri LAnka.
5. Twenty civl wars were ongoing as of 2007.
6. According to Fearon, the average civil war has been ten years with a median of seven years. Wikipedia has the number at four years.
7. From 1900 to 1944, civil wars only lasted 1.5 years. They occurred just as frequently as after 1944, just lasted less time.
8. Since 1945, civil wars killed 25 million people.
9. 55 of these civil wars were fought to control a central government.
10. The remainder were fought for secession (like Biafra or the United States) or regional autonomy.
11. Of the civil wars fought to control a government, 40% of the time the government crushed the rebels. 35% of the time the rebels won. Sixteen percent ended up in a pwer sharing agreement.
12. Most civil wars are fought in a guerilla fashion and are rural. Thus, the United States model of organized armies fielded by states is unusual.
13. Paul Collier and Anke Hoeffler, for the World Bank, argued that civil wars are primarily motivated by economic desires rather than identity issues. However identity issues did become important, and were a source to restart the conflict. I will report more on their work in a later Thoughtful Thursday.
14. Having commodity exports dramatically increases the chance of civil war. A country with one-third of its gross product being commodities has a twenty percent chance of getting a civil war in a five-year period. Those countries lacking exportable commodities are spared the risk of civil war. (The tendency to create conflicts is part, but not all, of the resource course)
15. And if there is a national diaspora, that dramatically increases (up to six times) the chance of a civil war. The diaspora finances the war. They are also likely to cause a flare up of the civil war, as the diaspora would often be nursing a grievance. (I had pointed out the possibility of giving the diaspora an explicit vote and say in my article on participatory-style Palestinian-Israeli Peace settlement.)
16. If there is a ethnic group which has a majority with minority ethnic groups, then there is more chance of a civil war as the minority might feel oppressed.

James Fearon argues that power sharing requires that both sides be cohesive and that there is a group or set of leaders which truly speak for the side, rather than there being a group of militias or war lords.

The purpose of Mr. Fearon's article is to discuss Iraq situation in particular. But the wonderful statistics on the civil war phenomena and tragedy are why I am reviewing it here. Some of the data comes from the Wikipedia article.

Several weeks ago, I proposed a Constitution Construction Kit. The ratification procedure takes into account ethnic identity, so each group is and feels protected. Votes can use a similar principle--to pass legislation, one needs a certain percentage of the votes from each ethnic group. Or where there are several choices, the winner will be the choice that has the largest minima over all ethnic groups. Fact Sixteen shows this is sometimes a problem, but by no means the dominant factor in predicting ethnic conflicts. Forming a world government has much of the same problem as the world certainly has point-source resources unequally distributed.

Constitution Construction Kit, Harel State Chart, Yunker Federal World Government, Thoughtful Thursday

Fairly frequently, countries try to change their constitution. A committee drafts a constitution and the people have two choices, to ratify it or not.

Examples include:

1. Italy presented to its voters a complicated constitution that was rejected.
2. The European Union presented a new constitution that would increase the Union but it was rejected by the voters in Denmark.
3. The Iraqi's voted on a Constitution in 2005. But again, it was a take-it or leave-it proposition. Thus, many Iraqi voters felt that they really did not like the one offered, but voted on it because it was better than not having any Constitution.
4. And more recently, Turkey and Kenya had Constitutional referenda.

And there have been proposals for unions, all that would require a Constitution:

1. a United States of East Africa as reported very ably by the Economist.
2. And a board game entrepreneur promoting a vision of a United States of Africa.
3. And lastly, uniting the entire world.

I proposed a Constitution Construction Kit, more later, which brings in the idea of workflows, nesting workflows. Lastly, the ontology for legal affairs, or computer representations of legal knowledge, help a constitutional court or a Supreme Court deciding whether an act obeys the Constitution. And it helps us simulate.

WorkFlow

An insurance company claim system exemplifies a business work flow. The insurance company decides that a claim under $1000.00 is handled and decided by a type A employee. Those above that amount are preprocessed by the type B employee. But a committee of seven makes the final decision and five out of the seven of these employees are needed to approve the claim. In either case, the claim is escallated to the president in three days if a decision is not made.

The workflow diagram is shown below.

The workflow starts when someone submits a form. In the example, the policy holder submits a claim. And one might have a workflow starting at a certain time, ensuring that a person execute a backup and that someone verify the backup was successful. Different individuals might fill out forms in a certain order. That is the electrical engineer reviews the plan and then the mechanical engineer reviews the form containing the plan. And in business, small groups might approve or vote on an activity. For example, an investment committee might have to approve a major capital project. Thus, the work flow system would have to count the number of positive and negative votes. And as we see above, based upon the results at each step, or the contents of a form, the system wil determine which new state go into. Thus, whether we go into State A or State B is determined by the amount of the claim. Whether a commitee votes in one way or another determines what happens to the large claim. And time passing will cause us to go into an "escalation" state.

Some workflows, based on a Petri net model allow parallel activities. Thus, the Electrical Engineer and the mechanical Engineer can review the document at the same time. When both give their approval, it goes on to the next state

The workflow system will have things happen as we transition from state to state. An email might go out, a credit card might be charged, or a letter might be printed and sent via conventional postal mail. It is not difficult to conceive of a workflow system activating a solenoid controlling a valve in our chemical plant at a certain state.

There are commercial workflow systems, where a computer professional enters the equivalent of the dataflow in some language or in XML, perhaps to be discussed in a future thoughtful Thursday.

Political Work Flows

The passing of a bill shows how workflows can model something in a Constitution. At the risk of being chauvanistic, I will use the United States Constitution, specifically the passing of a money bill, which our Constitution specifies must start with the House of Representatives.

We start with the House, which from the Constitution itself, simply emits the bill with no explanation or specification of how (more about that later). From there, as many readers will know the bill has to approved by the Senate and then on to the President, who may sign, vetoe or do neither.

1. Awaiting Senate Approval, after the House approves the bill
2. Awaiting the President's Signature, after the Senate approves the Bill
3. Depending upon what the president does, it may go to a termination state. One of these is obviously Law Passed. If the President does nothing, in ten days, and Congress is in Session, the bill is considered passed. (I recall reading that Cypress Semiconductor set up work flows where if someone who was supposed to approve something simply failed to do something about, it went on as if they did approval. This prevented someone from having to go chase a document that was on a procrastinator's desk.)

   However, should Congress ahve adjourned, then the bill is considered failed-- a pocket vetoe.

4. The rest of the flow is an override steps, going back to the House of Representatives, where the bill originated and then to the Senate if 2/3 override.

Nested workflows and Harel's State Charts

Simply, at any transition, there can be a whole workflow embedded. The Constitution has a simple transition from the start of a bill to it passing the house and awaiting the Senate to approve it. But that is a whole workflow of a Representative bsumbmitting the bill and being assigned to a Committee and being scheduled for debate and being ammended and finally have a vote of the full house.

At any point in that time, the House could adjourn to be reelected in its two year cycle, in which case the bill would fail. At any point in the process of the Senate reviewing and voting for a a Bill, the Congress could adjourn for a new session after new elections.

An additional feature is that one can model a flow from the superstate. Thus, when the HOUSE or SENATE adjourns that kills any bills in process. We can show that as a single arrow. The alternative would be draw an arrow from every substate of the HOUSE or SENATE to the dead state for adjournment as below.

One could also think of the boxes as a dataflow diagram--and I will have to consider this later in the discussion of the Constitutional Construction Kit, below.

State charts add to a simple state diagram, the ability to group states into logical superstates. Sometimes these are called HIGRAPH's for Hierarchical Graphs. State tables are often used in modelling computer software embedded in device. In avionics software, "in all airborne states, when yellow handle is pulled, seat will be ejected." And these need to handle several things going on at the same times. In a modern electronic wristwatch, the stopwatch might be in a state, the date setting might be in another state, and the normal watch itself is in a state. If one is in the process of setting the stopwatch or using the stopwatch, one might hit the button to go to the regular display state. When the owner then clicks a button to go back to the stopwatch, we may want to leave them wherever they were, perhaps in the process of setting the stop watch or the stopwatch is clicking off times, rather than going back to a start state. Dr. Harel did a masterful writing in his article using his own Citizen's electronic wristwatch as the example.

These features are not as relevant in political state tables. However, I can think of one example. In some states in some circumstances, one can appeal an order in the lower court to the upper court, even if the lower court has not finished with the case. Let's say one is getting ready to try one's case. The Judge rules that your star witness cannot testify because you made a spelling error in sending his name in. You could then request the appeals court to review that decision and if whatever happened, the case would go back to the lower court in same place as it was left off, perhaps with allowing that person to testify.

The Constitutional Construction Kit (CCK)

Every couple of decades, the United States engages in Regime Change with the nation somehow selecting a new Constitution. We saw it in Philipines in the 1900's, Roosevelt writing a new Constitution for Haiti new Constitutions for Germany and Japan after World War II, and of course much later, a new Constitution for IRAQ. Whether the United States will do this again is a subject ripe for speculation, but not in this blog.

In simulating a Constitution, unlike working with a business, one has to allow the particpatnts or members of a body to create a new workflow.

In the United States Constitution, Article One, Section Five, "Each House may determine the Rule of its Proceedings." We also have to allow various ways for individuals to be come members of bodies. That is we have to provide for elections appointments and random selections. The latter is only used today for juries., It is a very viable way of doing participatory democracy, sortion. Thus, if one were modelling the United States Constitution, we would see a workflow from each of the House and Senate to create or modify the workflow for creating and passing bills.

This concept is in other countrie's constitutions. For example, the Iraqi Constitution has the Council of Representatives cratings its bylaw for its rule. And article 93 designates that the Council chooses how the courts will be run and how judges and other officials are selected. Bahama Constitution Article 55, provides that each House of its legislature can regulates its procedure and make rules of procedures. in the Iranian Constitution, Article 62(2) specifies that the law will set how their legislature is elected. And like the United States, in Iraq and the Bahamas, the legislatures determines their own procedure.

And if there is an election, we need to provide for the rules of that election. And who resolves disputes. And in Secton Four, both State Legislatures and Congress can change the Workflow for the election of representatives.

A workflow has roles. For example, one specifies that an Insurance Adjustor of Rank Two or Higher can prepare a claim of over $1000.00 for Committee Decision. And we have a role called Member of Claim Approval Process. In a business workflow, one generally assumes this process is outside the workflow diagram. That is, one does not have a workflow to hire or promote a person to Insurance Adjustor Rank Two. And we certainly don't have the computer program handle those people authorized to change that procedure approving the decision to change it. (The appropriate manager would simply tell the computer professional to go change it ....) But in a Constitution Construction Kit we need all these roles. The people who elected to the House or Senate can change these workflows, as can the State legislatures. And our CCK must model these.

Approval Process

Our Constitution Construction Kit (CCK) will allow multiple parametric Constitutions to be prepared, and a vote to be conducted. Thus before the process starts, there has to be an optimized funcction. This will be a natural generalization of the requirement for ratification. For example, our constitution required nine out of thirteen states to vote. The Iraqi Constitution required n-2 out of the n provinces to approve by a majority vote. There are two obvious extensions. One can find the constitution that can get the majority vote in the most states or provinces. Or one can find the constitution that maximizes the vote in the province or state that gave the nth lowest approval percentage. Thus, if constitution A got votes in provinces:

33, 45 , 47, 49, 57, 58, 62

and constitution B got these votes:

22, 43, 49, 60, 62, 68, 70

If n were three, Constitution B would win as its third lowest vote were 49. But if n were only two, Constitution A would win. (Thus, one can see the importance of specifying the ratification procedure in advance.)

And if we had chosen in advance to look for the Constitution that had the most provinces with a majority in favor, Constitution Two would win as four states had a majority.

An ontology for constitutions

An ontology is a way of organizing knowledge, where there are links between various concepts. Several groups, notably in the Netherlands, are developing ontologies for legal concepts. One of these is the LKIF-Core Ontology, funded by the European Union.

Organizations, Artifacts, and the Purposes they serve. More specific to law, might be Statement, Declarations and Assertions and Document, as a bearer of Statements. The LKIF also has NORMATIVE statements such as prohibitions. They include obligations, allowance, obligations. Thus, a penal code might be defined as a Document containing prohibitions. Our group will also include classifications, so we can say that all persons who meet a condition are permitted to or required to do.

Thus the United States First Amendment giving freedom of speech would state that a particular ORGANIZATION (congress), could not contain a PROHIBITION of a particular SPEECH ACT. (The capitalized things are core concepts in the LKIF).

An ontology for constitutions would allow the parties to propose and vote on the following:

1. How are people chosen for officer positions or to be a member of a named ORGANIZATION? I identified three of these: election, appointment and sortition.

   I deal with elections first; these are so much in the mind of the average person about the purpose of the typical constitution. Which ORGANIZATION if any can provide further clarification? Are there conditional rules if the above fail or have controversy? The United States Constitution specifies these three of these in its Article Two on choosing the President. We see that the legislature sets the rules for appointing electors. It provides that a majority vote is selecting. It also provides for a default ROLE for the House of Representatives and Senate if there is a controversy over the election of a member.

2. The classifications of permissible persons must be specified for both those doing the voting or electing. Usually a constitution will state the CLASSIFICATION. For example, the United States Constitution specifies the familiar (to Americans) requirement that president be thirty five years old and a natural-born citizen. It also specifies requirements for the "Electors:" they are not a Senator, Representative or a person holding"an office of trust or profit under the United States."

   Or it may delegate it as in Article 47, Third section of the Iraq Constitution It states, "A law shall regulate the requirement for the candidate [for Council of Representatives, the voter and all that is connected with elections."

   As mentioned earlier, representatives can be specify that other organizations are chosen randomly from certain groups. The only example of this in the United States Constitution is juries, and even here the choosing process is not specified. However, many have written about Sortition. Ernest Callenbach and Michael Phillips proposed that the United States House of Representatives be chosen randomly from the people. Brian Martin proposes a network of decision making groups, which he terms demarchy. He does not propose a specific "constitution" for this network or a method of developing one, mentioning "second order" bodies to "adjudicate on how demarchy is supposed to be work." Paul Woodruff discusses how the Greeks implemented this idea. They had several mechanisms include a "Council of 500," "judges" and the election of experts for particular purposes.

   Most constitutions also provide procedure for the appointment of specific officers. (See Section Two, Clause Two of the United States Constitution which provides for the appointment of officials such as ambassadors, judges and others with "advice and consent" of two thirds of the Senate.)

3. prohibitions or grants of specific powers. E. G. Congress can pass a law on any of the following subjects, as given in Section Eight of Article One.
4. Certain acts require certain percentages or other functions of one or more groups. An example from the United States Constitution are that 66% of the ORGANIZATION, Senate, must approve a treaty, a type of DOCUMENT.
5. Obviously, one needs the mechanics for A Constitutional PROHIBITION. The Constitutional Court could be a workflow as a step on a law before it is approved. Or it could be as part of a workflow for resolving "CASES AND CONTROVERSIE's."
6. I note that the Estrella project has put its ontology onto the World Wide Web under the GNU Open Source license. Thus, I will be able to build upon it.

References

1. Boer, A. Winkels, R., Hoekstra, R and Van Engles, “Knowledge management for Legislative Drafting in an International Setting” In Legal Knowledge and Information Systems. Jurix 2003: The Sixteenth Annual Conference (Amsterdam) IOS Press 91-100
2. Boer, A., Di Bello, M., van den Berg, K., Estrella, European Project for Standardised Transparent Representations in order to Extend Legal Accessability, Deliverable 1.1, Specificfication of the Legal Knowledge Interchange Format, IST 2004 027655
3. Harel, David, "StateCharts: A Visual Formalism for Complex Systems" Science of Computer Programming Volume Eight, 1987, 231 to 274. See http://www.wisdom.weizmann.ac.il/~dharel/SCANNED.PAPERS/Statecharts.pdf
4. Sanminiatelli, M. \fIItalians Vote in Massive Reform Referendum\fR Yahoo News, Associated Press can be found at http://abcnews.go.com/International/wireStory?id=2114939
5. Yunker, James, A New Vision of Federal World Government, University Press of America, 2007

Thoughtful Thursday, a second Review of Constitution for a Future Country by Dr. Martin Bailey

Martin J. Bailey, Constitution for a Future Country, part Two

In Chapter Four, Dr. Baylor pointed out--as I have long felt--that when a new government was forming, the leaders were only given the U. S. Constitutions or the parliamentary system to serve as a guide. There has been no improvement in government for two hundred years. He recognizes that a country does not throw out its old Constitution and put in a new one just because logic or economic theory or public choice theory says this one is better. But when there is a situation like the collapse of the Soviet system in Eastern Europe or Afghanistan forming a new government, the leaders of the transition might ask for help looking for a better way.

Dr. Baylor wrote this book in his dying days to provide that help. It is my goal to provide this help also, but in the form of computer programs. We simulate things on the computer before we build them, whether it be the finite element analysis of a bridge resisting the forces of winds and the trucks riding upon them or the robustness of a electric grid as loads change and generators or alternative power sources upon them. The people who must ratify a constitution should be able to simulate it. Just as a pilot practices emergency moves such as an engine stall in a simulator, the people must practice dealing with budgeting during a depression, handling a natural disaster like Katrina. And the judicial system must be practiced as well. How would a one-state solution to the Palestinians and Jews in the Middle East deal with a Palestian Police Officer shooting an Orthodox Jew or the other way? A Law Enforcement class might enact a trial to learn criminal procedure. The people will first vote on a judicial code under a trial constitution. Then, they will have whatever election process that would include for judges. Then the judges and the jury, if their constitution so provides, will try moot cases. This would definitely include staged charged situation of one ethnic group shooting a member of the other. If they can't do it in a mock trial--is there any reason to believe they could accept the results when it happens for real. And we should do it in the more quotidian cases such as those that one might see in Judge Wapner's People's Court.)

As an economist, Dr. Bailey is very concerned that government expenditures are handled efficiently. And he starts with Lindahl taxes. Each possible group, doctors living in Wyoming, wealthy financiers living in tony Connecticut towns, coal miners in Apalachia, single people, married families, will be represented by random samples from their numbers. These will be chosen randomly, what Dr. Bailey refers to as a stratified sample. They will each propose a tax to fall on their group proportional to their marginal benefit. Dr. Bailey that each group can be divided into other groups. But each division would be based on some objective criteria, such as gender, race, occupation group, income or the like.

And taxes would be either based upon property or income and have a tax schedule. The taxes would be categorized by budget category. Thus, there might be a property tax on automobiles to fund the highway system. The goal is to get a near unanomous vote. Also, every two years, there should be the opportunity to vote for a minimal budget for basic public safety needs--equivalent to the partial shutdown of the government that were used during budget stalemates in some states.

As each funding proposal comes through, citizens vote their uninsured harm (VCG taxes) and also can purchase Thompson Insurance for monetary losses. Dr. Bailey proposes limits of about ten to twenty percent of income for these. This means there is no way for a citizen to express extreme concern-- for example a pro-lifer expressing extreme concern about legalized abortion, or a Native American expressing extreme concern about a mine on a sacred burial ground.

And Dr. Bailey proposes a complicated formula for legislative pay which includes a variety of incentives. (See below.) The first is at the start of the public good chain. If their estimate of Lindahl Dr. Bailey believes that legislators should be sequestered like juries in major cases. They should only get information in an organized way through formal hearings and not emotional impacts. More importantly, there would be no way to lobby legislators. Legislator's wealth would be replaced by a mutual fund weighted like theinvestments of their demographic groups. Thus, a physician representing his fellow physicians would sell their investments and be given a set of investments that matches what an average physician has. Cumulanis' Constitution (that's what Dr. Bailey calls his hypothetical State) specifies that legislators shall vote the amount of money they and their family would pay to put through or stop a certain legislature.

And Dr. Bailey believes in referenda, anyone including corporatins can put a referendum on the ballot if they pay the costss including evaluation. Dr. Bailey calls for impartial statisticians to estimate the possibility of referenda passing--I guess after polling. If the odds are ten percent ormore Obviously, there are various technical correction bills that are not controversial. The statistical groupo could find which ones have a 95% chance of passing and these could be grouped in a single up or down vote. He furthermore proposes that referenda be voted on twice, with the first vote just to see if there is interest and requires 25 per cent of the vote. If a legislature makes a proposal rejected by 75 per cent of the people shall have the costs of the ballot deducted from their incentive pay.

Of course legislators have important roles, including determining the size of ebverybody's taxes--although with his mechanisms less of a role than currently. But many other jobs including the election commissioners that administer the non-trivial software systems, the statisticians are critical. And, what about those making decisions about deep oil drilling equipment. Or those administering large contracts for the government.

Dr. Bailey realizes that the VCG mechanism although a Nash equilibrium is not immune to collusion. Cumulanis' constitution simply says that attempt to organize voters to misrepresent their harms that would defeat the nice economic properties of VCG taxes is a felony! Dr. Bailey notes that under the bill of Rights, it is perfectly legal to encourage voters to vote strategically, e. g. a citizen could take out adds encouraging Republicans to cross over and vote in the Democratic Party and vote to nominate an extremely liberal candidate so the Republican party candidate wins.

Dr. Bailey believes legislatures should be paid on a contractual basis with the voters who are sovereign. Thus, every bill should have measures of success. The education bill should state that 70% of the children shall read at grade level for example. The legislature making the education proposal would be responsible for contracting out the education function and monitoring it. If the education system got only 65%--then any citizen can sue them. "The criteria for standing admissibility of suits shall be identical to those for suits against private parties as specified by the laws of torts and contracts." Now, who would have the right to sue here. Would I as a taxpayer or simply a citizen who cared that kids get a good education or a professor who felt that I want students who know how to read and write in my class have the right to institute a suit? (The Supreme Court has restricted this right. Taxpayers do not have the right to pursue a generalized claim that their funds are being mispent. Parents of a particular ethnic group could not sue regarding giving tax exempt treatment to schools that discriminated against their children. And lastly individuals could not sue on behalf of animals under the Endangered Species Act. A generalized claim that the person might not see the animal when they are traveling is not sufficient.)

In the same article, Dr. Bailey proposes mechanisms to make budget estimates more accurate and realistic. Each tax schedule shall have an estimate of how much revenue it will bring in. (And he provides for macroeconomic downturns that are not the estimator's fault.) Legislators cold be sued when their budget estimates were simply incorrect--presumably discouraging the budget shenanigans we say at the state and federal level in the United States. (I have pointed out that there are ways of organizing the budgeting structure constitutionally without budget estimates. One specifies the tax schedule and whatever it brings in is what that government has. Also, one can specify an expense and the people who shall bear it. They compete on a goodness or badness basis before sortition jurors to determine who should pay it. For example, the car owners shall be required to pay for the highway expenses. Each goes before a tax sortition juror and pays a tax based upon how safe they drive, how much they needed to drive (those who lived on a farm out in the boonies might have no choice but to use their vehicle and the sortition jury would assign them a small share of the highway taxes. But someone who might use their vehicle when the Greyhound bus went where they needed to or who drived for vacations.)

One can also use approval voting to determine expenditures. That which 100% vote for gets funded first, then what 99% vote for, etc. The tax schedule brings in whatever it brings in. The things wanted by the most people gets funded first.

Thompson Insurance

A street project would improve the value of some people's property. It would lower the value of others. Every proposal would be associated with a Thompson insurance. The first parties could take out insurance against the proposal failing. The other parties would take out insurance against it passing. A neutral government body must offer this. Dr. Bailey cited work in the law and economics literature that insurance really doesn't work for intangibles such as pain and suffering. And a majority could keep proposing the same thing, bankrupting a minority. That is if the majority might keep proposing the mine on the ethnic group's grave field. The ethnic group would take out insurance against the bill passing, defeating it. However, they would eventually run out of money.

Thus, this really does not deal with the pro-life individual concerned about legalizing abortions or the pro-choice concerned about a proposal to restrict abortion. Dr. Bailey's constitution would have would have limits that would not allow a person to declare the severe harm for their ethical sensibilities. Dr. Bailey realizes this and he says that his mechanisms could not handle it. He says, "The performance of a country with our proposed constitution could be almost an arbitrary and capricious on this issue as the ... United States has been. That is a pity, and if the reader can think of a constitutional order that would arrive at sound policy on such issues more reliably than that proposed, please publish it." I have an idea--and will be posting it shortly here. I should also mention Dr. Bailey's concern about entry into war on spurious grounds. He mentioned the Gulf-of-Tonkin resolution that got the United States escalated in the Vietnam war and the less-disastrous Spanish American war. This book was published and Dr. Bailey passed away before the entry into IRAQ, a situation that has been compared. And Dr. Woodruff discussed the problem in the Greek invasion of Syracuse. system. (I proposed a solution of waiting to reward our statespeople and military leaders.)

Appendix -- Incentives for Legisltuares

Section Eleven includes detail for all legislators. Here are some of the formulas to give a flavor: "0.1 percent of the budget amount contained int he proposal plus thirty percent of the total declared insured and uninsured harm from non-adoption, net of the declared harm from adoption, relative to the next most valuable distinct and differeent proposed by another legilature, less five percent of the net inferiority of these proposals, relative to distinct and different alternatives of the ballot, for each population that on net would have supported an alternative proposal int he group, under the legislature's proposed taxes and accurate taxes for the alternative."

Martin J. Bailey, Constitution for a Future Country, Thoughtful Thursday,

I am reading Martin J. Bailey, Constitution for a Future Country, Palgrave-McMillian, 2001 JC 330.15 B35 2001. It is available at Columbia University library at which I am taking a game theory course--more on that later post. I only have read the first two chapters-but the ideas are there. (I have not been able to get it at my usual discount I am hesitant to spring for it until I am sure it was worth it, which it is.)

He proposes a finely crafted construction of the best that public choice/game theory can provide and sortition/direct democracy.

1. The legislature is elected by sortition.
2. All things passed by the legislature are approved by the referendum.
3. Start with Congress, I will refer to as the legislature, estimate of Lindahl taxes
4. Use the Vickrey Clarke Groves Tax, about which I need to blog later, for each proposal. People can offer a payment to have a proposal pass or not pass. Thus gunowners can offer a payment to not pass a gun law. Similarly, those in crime-ridden neighborhoods might offer a payment to get the bill passed. The Vickrey Clarke Groves tax only registers if one needs a little bit of money to pass or not pass the item. Thus many people might offer a payment and it not be taken. For large populations, many people would pay a small additional payment and even larger amount would not pay anything out as they pay nothing.
5. Citizens can pay for insurance for or against the passing of a new referendum. E. G., stock holders of power plants could purchase insurance Dr. Baylor states that although sortition for legislatures has been "proposed from time to time," one should combine it with the above-mentioned strategies.
6. He argues that legislatures could compete. Several legislatures could propose proposals and may the best one win. (He didn't mention but approval voting comes into play here!) In my second post in May 2009, I proposed this idea for health care plans. Forty percent of either house as well as the President directly could propose a plan.
7. He argues that payments to the destitute should be mandated by the constitution with other payments by the VCG mechanism. He points out that payments to the needy can create perverse incentives. Payments to those who lost their house in a hurricane encourages people to build to close to the beach. And Malthus argues that payments to the poor encouraged them to have more children and not to move as needed to find work. (People are still saying that. I recall reading that some historian found such arguments in Italy eight hundred years ago but unfortunately I can't find it right now.)

   Dr. Baylor argues that such arguments poison our commonweal and argument and should be settled one and for all. I proposed that such matters can be handled by sortition juries on a non-entitlement individual basis in the health care field. Yes, your house went down. Could you have done something about it? Should you reasonably have bought private insurance? Are you more needy than others who also lost their house, whether due to a hurricane or just an "ordinary" fire.? (I need to blog more on sortition juries for charity as opposed to bureaucratic rules.) He argues that there should be one Commander in Chief of the Armed Forces. I have argued here for multiple chief executives..

8. He also argues that there is no reason for a supreme court for statutory. That is the role of the elected legislature or as I have argued elsewhere, a referendum when the justices disagree. Dr. Bailey argues that a statute which is vague enough to be interpreted or where the legislature left a case not considered, means the law should be patched up. I have always wondered if there is a need for a separate court for interpreting statutes. However, the court does have a role to preserve enduring values of the republic and civilization--in the United States these would be individual rights.
9. In civil cases, the parties could hopefully agree on arbitrators. If so, that would be the arbitrary and the private arbitrator earns a fee. If the parties do not choose an arbitrator together, or one is simply obstinate and refuses to even appear, then a magistrate chooses one randomly. (He calls them magistrates. The term clerk or ministerial action come to my mind.)
10. He argues for contracting stuff out. Legislatures would be judged and paid on the success of their proposals and would have an incentive to find good firms to implement the programs they proposed and were voted on by referendum.

He talks about how his proposed constitution comes to pass. The Vickrey-Clarke-Groves mechanism, The Thompson insurance plan, are not easy to explain. In fact, I suspect that many reading these do not understand them. However, Dr. Bailey points out that once the Constitution is approved, it is not hard for the voter to understand what to do and how to make their preferences heard. The hard part is at the beginning. I propose, we have nationwide simulations of these mechanisms-- in fact all proposed mechanisms in a constitution.

He realized that the best time to propose this new idea for how to govern a country is when the country is in in transition. The change to the Post-Soviet regimes in Eastern Europe or post-Saddam Iraq. Does it depend upon an enlightened statements or by a process of simulation by the whole population and then voting.

I did not see in the first two chapters or the index, federalism. How do some groups maintain their integrity in a Constitution, such as in a one state or two state solution.

A Deeply Sad Note

Martin Bailey passed away in 2001 from a brain tumor. I knew about this book for some time, and thought/fantasized that perhaps Martin Bailey could work on a project to simulate his ideas, and maybe I could modestly help with this programming.

Two-State Solution or One State Solution

I mentioned the Constitution Construction Kit in two African contexts

1. Unity of the entire content
2. A proposed United States of East Africa

Another is a minority of experts who suggest that having a single country composed of Israeli Jews and Palestinians is more viable than the usual two-state solution.

Meron Benvenisti made a pronouncement that 'the fight for the two-state solution is obsolete'" because of settlement pressure.

I will do a Thoughtful Thursday on The Constitution Construction Kit.

United States of Africa

I reported from the Economist that there is a move to unite the countries of East Africa. A Board Game entrepreneur has a game to help promote the vision of a United States of Africa. Unfortunately, the board game says nothing about how the country should be governed, its constitution, etc. It is part chance and part "Trivial Pursuit," answering questions like "Which country in Africa was never colonized?" and identifying the President of the Ivory Coast. We need to simulate this process so people can learn about how it would actually work, which is the proposal of my Constitution Construction Kit.

United States of East Africa and a Constitution Construction Kit

In my white paper, Three Systems, I talk about a Constitution Construction Kit for those nations or groups of nations that anticipate developing a new Constitution. Well it looks like there is one more application, a United States of East Africa as reported very ably by the Economist.