Business Insider and Bayesianism

I’ve used this blog post from economist Bryan Caplan several times to explain Bayesian thinking to people – basically the idea that we should derive our opinions from the sum of information about a topic rather than selected data points (likely chosen because they support our presupposed biases). I recently posted a review of the Business Insider website and pointed out one of the things I enjoy so much are their interest grabbing headlines.

I realized today one of the reasons I like the headlines so much is that they boil what is typically a complex issue down into one definitive assertion. Consider these just from today:

Wall Street’s Brightest Minds Reveal THE MOST IMPORTANT CHARTS IN THE WORLD

The Real Reason Why Market Rallies End

A New Poll Shows Americans Don’t Actually Understand Anything About The Deficit

The most important chart in the world, the real reason rallies end, Americans don’t understand anything about the deficit. I’ll quote Kip Dynamite: “Like anyone could know that.” While fun to read, this one blog post is proof that Business Insider is the least Bayesian website on the Internet. 😉

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Affordable Care Act Hurts Young People

http://www.forbes.com/sites/realspin/2013/08/21/obamacare-is-really-really-bad-for-you-especially-if-youre-young/

This is a good article which explains some problems with the Affordable Care Act (aka Obamacare) for young people.

First, the proper observation that the ACA is an explicit transfer of wealth from young to old:

“Preventing health insurers from fully accounting for age will not change the reality that, in general, the older you are, the greater your medical expenses (six times greater, when you compare 64-year-olds to 18-year-olds). These are costs that someone has to pay. If insurers can’t charge those older according to their risk, they have to overcharge those younger to make up the cost. In California, for example, once the new health law’s various rate restrictions and other provisions kick in, 25-year-old non-smoking men will see their premiums at least double.”

Next, is an easy to understand case study in why the Affordable Care Act’s mandate on healthcare expenditures make it harder to achieve:

“Even though Brian judges this to be the best way to manage his medical expenses, under the health law, it’s illegal for insurers to offer him a policy geared to his actual risk. Instead, per government mandate, a portion of the income he earns and intends to use to build his life is channeled into the pockets of others.”

Ned continues to campaign against the market distorting mandates included in the Affordable Care Act.