The Captured Perspective

“To teach, or not to teach” is increasingly the question in the nascent but rapidly expanding microfinance industry.  Each microfinance bank must decide whether it wants to offer free business training/education/consulting to its borrowers.  While the exact business model varies by bank and by region, microfinance banks generally make small, unsecured loans to poor people to enable them to start (or expand) their own businesses.  The capitalistic undertones, empowerment of the underserved individuals, and solid financial results have made microfinance a darling of the development community in recent years.  Industry leaders have been split, however, on the importance of providing free business training along with each loan.

As a practitioner in the industry (I work at a private equity fund that purchases and manages microfinance banks around the world), I have spent not a small amount of time spinning my proverbial wheels on this question.  My initial reaction, as an unfettered, starry-eyed believer in the power of education, is that education is good and the more the better.  But upon further reflection and study, I have found this proclivity challenged.

First, I should clarify what I mean by “business training” and “education”.  All (good) microfinance loan officers do a fair amount of hands-on training as part of the credit approval and monitoring process.  This tends to include covering basic accounting/bookkeeping and assessing the borrower’s business concept.  Additionally, and perhaps more importantly, where the bank’s lending model is focused on groups (one large loan given to a group of 6-12 people who have joint liability for the total sum and meet once every week or two), the group serves as a valuable sounding board and learning tool for each of its members.  The business training that is being debated is in addition to this; it aims to give potential entrepreneurs ideas about what types of businesses they could start and/or directs existing ones about how they can grow or change.

While on the surface, this seems like a great idea, it also suggests a certain hubris or arrogance on our part.  Who are we to tell a small-scale entrepreneur in Cambodia what he or she should make, sell, plant, or distribute?  It raises the question of what that capitalistic spirit we love so much really means – is it something inherent in each of us or does it have to be taught?  The inventiveness and brilliance exhibited by many of the entrepreneurs, without any help from “us” other than enabling through passive capital, is a humbling thing.  Who knows the local markets and local customers better than the locals themselves?

Many of the behemoths in the industry, from Mohammud Yunnus of Grameen, to Vickram Akula of SKS in India, to Compartamos in Mexico, have resisted the lure of suggesting what their clients should do with their loans.  What if the idea provided fails and the client defaults?  Is the client really to blame if it came from the bank’s own educator?

Furthermore, providing free education is a considerable expense that a bank could be putting towards underwriting more loans or reducing the interest rates it charges its customers.  At its core, a bank’s core competence should be analyzing and pricing credit; I believe it provides its most precious, long-term public good by being the best allocator of capital it can be.

I’m not implying that education isn’t critically important; I believe the development of education systems in lesser-developed countries is key to their ultimate success.  But I don’t think that a bank should be the educator.  I was dismayed by a recent NY Times article titled, “Lending Talent, and Money, on a Micro Scale,” which if you read it will leave you with a warm and fuzzy feeling about how great “we” are at educating the poor.  Are there cases where business education has helped?  Absolutely; just be wary of the self-affirming mindset that we know best.

AM Laboratory

The other day, a friend sent me a link to the aM laboratory tone matrix. Playing around with this music simulator made me think a bit about the role of experimental learning tools in education. You can check out the simulator here, but be prepared to lose an hour of your day (err…. or several hours?).

In the tone matrix, you press the dark grey buttons to make them white, and thus to “turn on” that specific tone.  Then, the simulator runs a continuous linear run through the matrix, playing whichever tones are highlighted. The lighter greyish spots on the picture to the left are a representation of the progression of the simulation (those notes were just played just before I took this screenshot). The tone matrix thus creates an environment of real time feedback where the tones selected and the sounds they create make a simultanous visual/audio representation of the constructed music.

For example, on the right is a picture of my recreation of “Boom Boom Pow” by Black Eyed Peas (Rachmaninoff was bit too complex for me right now.).  At the lower left of the matrix you can see the two bass notes (“boom boom”), followed by the “pow” in the upper part of the same quadrant, near the middle of the screen.  The melody is represented in the upper two sections of the matrix (“I got that hit the beat the block”), starting with the last three notes on the screen (upper right quadrant), and continuing with the other remaining three notes when the cycle begins anew.

Boom Boom Pow

So what are the benefits of using this tool for learning music?  Well, for one, in playing around with “boom boom pow”, I was able to test out different melodies, see the range between notes that create the harmonies of interest, and then experiment with temporal space to create the necessary rhythms. I could see and feel the difference between a rhythmic space of two and space of three that creates the syncopated ‘boom boom pow’ (3 spaces) as compared to the rhythm at the start of the melody (2 spaces). In the more complex composition shown at the top of this post, I experimented with different rhythms, multiple scales working simultaneously, and the use of space to emphasize tone.  And, while these methods are all available while plunking away at the piano, the benefit of this tone simulation approach is that the feedback is entirely in real time, and it allows you to ‘play’ at a level above your ability.  To be fair, the major drawback it is much less cool to pull out a macbook and play some tones on repeat than it is to dance your fingers across a Steinway Grand.

While the use of the simulator for music education is interesting in itself, it made me wonder whether these types of simulation techniques could be applied in the development of supplementary methods for teaching subjects like mathematics, economics, and even logic. In each of these subjects, a real-time feedback and multiple-sense learning approach could help teach an intuitive understanding of these topics, as a supplement to the application of formulas, and the following of rules. Think of it as the Suzuki method going digital and taking on other subjects… learning to do math/economics/ logic ‘by ear.’

Summer Vacation

Lazy summer days — the nostalgia that all adults dream for as their kids finish school and start a seemingly endless parade of days at the pool topped off by neighborhood night games. Public schools across the country are either nearly or completely finished with their academic calender, and thus entering the two to three month blissful hiatus of summer vacation. I am currently enjoying such benefits, having finished my first year of public school teaching close to two weeks ago. In fact, I have a whole new found appreciation for summer break, and am no longer sure who craves the summer break more … teachers or students. The screams and shouts from ecstatic kids heading home for the summer was matched — in my “unbiased” opinion– by the sighs of relief of a cohort of exhausted teachers on the last day of classes.

Coinciding with the end of the school year, I stumbled upon an interesting debate between Conor Clarke and Conor Frierdersdorf, from the Atlantic and The American Scene respectively. Conor Clarke recently penned an interesting piece, Why We Should Get Rid Of Summer Vacation, discussing the merits of a longer school year for eliminating inequality within the school system – specifically, inequality of opportunity. Frierdersdorf countered with his response, Our Children Aren’t Economic Inputs, ultimately disagreeing with Mr. Clarke and opting for the traditional school year. Here Frierdersdorf writes:

Okay, I’m all for addressing that inequity, but I’d prefer a method that doesn’t rob the wealthy kids — and the middle class kids if my childhood summers are any indication — of those edifying summer experiences. Give me Pareto optimality, please! Besides, kids already spend enough time within a public education system that teaches conformity and deadens love of learning. Let them take their summers outside the system, experiencing life, and getting value that it is difficult to represent on blog charts.

Both authors present compelling cases, and there is merit to both arguments. Personally, I grew up privileged enough to enjoy my summer break with a range of edifying experiences. Summer wasn’t simply an absence from school; rather, it was filled with a variety of enriching non-traditional academic activities (i.e. trips to the Museum of Science and Industry, the Chicago Field Museum, the Shedd Aquarium, visits to the local library, and challenging conversation from my parents). I fall squarely into the category of the middle class kid who benefited academically from the variety of summer activities. And Mr. Frierdersdorf’s response hits close to home: I loved my summer breaks and wouldn’t give them up for the world.

In contrast, I have recently witnessed first-hand the effects of a long summer break on my students in St. Louis. Specifically, while there are a variety of free, educational filled events and activities in St. Louis, few of my children take the chance to engage with this public sphere. Part of this lack of engagement derives from single parent working several jobs, and multiple shifts. It is challenging, to say the least, to forget the responsibility of work in a poor economy to take your child to the St. Louis History Museum. What results is that kids from lower socioeconomic groups come in far behind their higher socioeconomic peers because their summer hasn’t been filled with enriching academic experiences.

Paul Tough in his latest book, Whatever It Takes, follows Geoffery Canada and his quest to create a sustainable social safety net that offers equality of opportunity for children from Harlem. Canada offers similar insights on the impact of this “summer lag time” for his students. Children from lower socioeconomic backgrounds can learn the same amount of academic content as their more affluent peers from September to May, but come in farther behind at the beginning of the school year because of categorically different summers. Should the government be obliged to alter existing education policy to create a system that values equality of opportunity? In some ways, yes. Providing equal opportunities (or at least removing unequal constraints) is at the foundation of this country.  Consequently, current education policy needs to be reexamined as our nation tries to effectively improve the education and future opportunities of its citizens.

I agree with  Conor Clarke’s argument for revising the current academic school year, even if it means less “summertime fun.” Our current system, a vestige from a former agrarian era, does not accurately reflect the challenges of urban education. The majority of kids from urban neighborhoods do not need a two month plus vacation devoid of learning simply because they cannot compete with the opportunities and experiences that their more affluent peers are encountering. Clarke emphasizes an important point – “Education is fundamentally about creating equal opportunities.” If we as a society affirm this foundation, then we need to closely review our current academic structure. A simple policy adjustment has the potential to drastically alter and reclaim the original foundation for public education – providing each student equal access to an exciting array of life experiences.

My basic argument, rather crude in hindsight though it does reflect my gut instincts, is that a right to healthcare implies a right to health. Consider the ongoing debate concerning the cost and efficacy of medical care. If decency demands that the state provide medical care, this inevitably raises the following question: if the state is left holding the bag, so to speak, surely the state can demand that one lead a basically healthy life, hence the ever-expanding imperatives of public health. A right to healthcare implies a right to health, or rather an entitlement to health. If this isn’t a recipe for an unlimited state, what is?

-Reihan Salam

Reihan makes some good points, but I am not sure I buy his coupling of the right to health care and the right to health. While I am by no means a health care expert, I think it is important to nail down some of the philosophical starting points of a health care debate before the nitty-gritty policy details. So, here goes one feeble attempt.

First, it seems as though there is a range of potential claims when talking about rights, health, and healthcare, all with different policy implications. Specifically:

• Everyone has a right to health
• Everyone has a right to the best health care
• Everyone has a right to sufficient health care
• Some people have a right to the best care, some people have a right to sufficient care
• No one has a right to health care, but people can get care to the extent they can afford it

As Reihan helpfully argues, the first point is difficult both theoretically and pragmatically.  On the theory side, its hard to know what equal ‘health’ really entails. If taken to imply actual health equality, the point is complicated in that people start with different levels of baseline health, and make different healthy life choices given this freedom (what to eat, whether to smoke, if and when to work-out). The state cannot guarantee that all individuals will be equally healthy in so much that outcome is contingent on a number of factors outside the guarantor.  You can guarantee me the right to play in the NBA, but if I am not that athletic by birth and sit around all day and eat sour patch kids and super-sized fries, this ‘right’ will be violated when David Stern doesn’t call out my name on draft day.

Perhaps this could effectively be re-stated as a right to not have one’s ability to live a healthy live infringed upon.  This would be broader than health care coverage, in that it deals directly with the state providing healthy conditions for living, basic services, etc., but not so broad as to assume that all people will be equally healthy at end end of the day.

The difference between the second and third premises is tricky, because its hard to know what care is ‘best,’ and what is just ‘sufficient.’  This point is helpfully explored by Atul Gawande in his recent New Yorker article, which Peter Tuuk linked to in a recent post.  We often assume that more care is better care, thus validating its extra cost; unfortunately, the comparison of average healthiness between areas that pay a lot for care and those that do not is tenuous at best.

Our current systesm seems couched somewhere between the 4th and 5th premise.  It is similar to the former in that there are currently differences in “quality” (or at least quantity) of care for people in different systems. Certain providers cover a wider variety of treatments than others, and others limit the doctors who you can see, thus controlling ‘quality’ if certain doctors and treatments are better than others. We are closer to the 5th premise in that the government does not formalize a rights system like we do with public education, for example.

In an ideal world, I would argue that the state should build a system off of some sort of combination of the first, third and fourth premises. Specifically, I think the government should look to create environments for its citizens where health is most possible, if pursued appropriately (1st premise).  I also think the state should move to providing universal care for its citizens, even if that does not take a fully public system (3rd premise).  So, perhaps the state should find a way to provide appropriate care (which, as shown in the McAllen article, might actually be better), while acknowledging that there should be options for increasing this coverage (4th premise).

I am less sure on what this might look like in practice. Tyler Cowen makes some pragmatic suggestions to deal with the false cost/effective trade-off in Medicare, some of which could be applied more broadly to a universal coverage system:

If we are willing to take comparative-effectiveness studies seriously (me- which imply most cost does not equal better treatment), we could make some significant cuts in Medicare costs right now. We could cut some reimbursements rates, limit coverage for some of the more speculative treatments, like some forms of knee and back surgery, and place more limits on end-of-life-care.

Reihan, on the other hand, takes his argument to an economic outcome based perspective. He writes, “we’re more likely to keep the role of state limited if we eschew rights-talk and instead think of the state’s role in healthcare as fundamentally about managing economic risk.” Thus, in line with Graetz and Mashaw and their thesis in “True Security”, he suggests “no family will go bankrupt due to an economic shock caused by serious illness.”  While not a bad alternative, I wonder if we can really discount the fact that this ‘shock’ is not primarily about the economics, at least for the families involved. Why not try to implant a system where adequate (read: not necessarily most expensive) care can be provided during the shock, which limits both the health and economic shock footprint for the individuals/families in question? Doing it in a cost-effective manner however is still an issue…

For the newest issue of the New Yorker, Atul Gawande travels to McAllen, Texas to try to understand why that county has higher health care costs than anywhere else in the United States. He pins the blame on perverse economic inscentives that pay doctors more for more procedures. The doctors, as gatekeepers to the system, exercise great latitude in how care that is meted out. He points to one example of a physician-owned hospital that

has a reputation (which it disclaims) for aggressively recruiting high-volume physicians to become investors and send patients there. Physicians who do so receive not only their fee for whatever service they provide but also a percentage of the hospital’s profits from the tests, surgery, or other care patients are given. (In 2007, its profits totalled thirty-four million dollars.) Romero and others argued that this gives physicians an unholy temptation to overorder.

This is a strange market in which neither of the parties who will make a decision as to how much care is to be rendered have any incentive to opt for a lower number. The patient feels like more is better, because better-safe-than-sorry. The doctor knows that more is better, because his pocketbook says so. And for him, the specter of future malpractice litigation for unprovided care is just one more reason. The big loser in this process is everybody who isn’t there. We pay higher insurance premiums or higher taxes.

The author provides another model however. He points to the Mayo Clinic in Rochester, Minnesota. The key difference between Mayo and other health care providers is that Mayo doctors, like all the other employees there, are paid a salary. Their inscentives are not to treat as many patients as possible, but to treat those patients they do see well. When the numbers are tallied, the Mayo Clinic produces above-average outcomes at below-average costs.

If there is an organizational structure for providing a better product at a lower cost, why has this method not come to dominate the industry? If anything, there is money to be made by opening up a place like Mayo Clinic, advertising great care, charging a penny less than they guy next-door, and keeping the cost margin as profit. But who loses here? Not the patients, who get better care. Not the insurers (or taxpayers), who get lower costs. Only the doctors, who don’t have the opportunity to make big money ordering all sorts of extra procedures. But if doctors want to perpetuate the existing order by clinging to sub-standard products at higher costs, there are a few GM employees who can tell the rest of that story.

Of course all the standard charter school selection biases apply. The patients could be more motivated and disciplined at Mayo Clinic. Or maybe the health care providers could be special in a way that doesn’t generalize to most settings. Why don’t we have better care?

EDITORS NOTE: A special welcome to our newest blogger, Caroline Allen!

In a thought-provoking new book called, “My Stroke of Insight”, the Harvard-trained brain scientist, Dr. Jill Bolte Taylor, describes the life-threatening stroke she had at age 37. Hers was an arteriovenous malformation, or AVM, stroke caused by a congenital disorder which occurs when a person lacks a capillary between her artery and vein connections. Eventually, the over-worked veins burst from the constant, high blood pressure in the arteries, causing a massive hemorrhage in the brain.

Dr. Taylor was fully conscious over the four hour period that the massive hemorrhage took place in her left hemisphere. With her logical, sequentially thinking hemisphere disabled, she was unable to walk, talk, read, write, or access most of her tacit knowledge and memories. Interestingly though, she found this new right hemispheric existence to be euphoric and peaceful. Without her left brain to tell her where the boundaries of her body were, she felt an incredible oneness with the world and the people around her. She was fully present in every moment and acutely felt the joy of just being as described in this excerpt:

The essence of your energy expands as it blends with the energy around you, and you sense that you are as big as the universe. Those little voices in your head, reminding you of who you are and where you live, become silent. You lose memory connection to your old emotional self and the richness of this moment, right here, right now, captivates your perception. Everything, including the life force you are, radiates pure energy. With child like curiosity, your heart soars in peace and your mind explores new ways of swimming in a sea of euphoria. Then ask yourself, how motivated would you be to come back to a highly structured routine?

The key takeaway of her book is that we should all be tapping into this euphoric state within us or, as a phrase on the back of the paperback purports, “peace is just a thought away”. While I am fully on board with the importance of living in the present and not being caught up in the past or worrying excessively about the future (the idea is Biblical after all, Matthew 6:27), the message that we should avoid the unpleasant things in life by escaping to the present is dangerous.

A red flag appears because the state described could easily be confused with a heroin experience. Both disassociate a person with her burdensome reason and judgment and enable her to experience a rich, dreamlike present… only without the high price tag or harmful physical side effects. But, in the example of drug use, is it really the price and bodily side effects that make habitual drug use devastating? Or is it actually one’s retreat from society and the shirking of one’s responsibilities to family, friends, and work that cause the real damage?

Just because we can potentially shut the world out and enjoy a present euphoria within our minds, ignoring who and what we are, should we? I think the circumstances in our lives, like how good an employee, brother/sister, husband/wife, father/mother, or friend we are, can bring equal or even greater levels of peace, joy, and fulfillment to us; but it takes time, effort, and there are no shortcuts. It’s not that being more present is wrong, only that ignoring the greater context of our lives, as monitored and communicated by our diligent and sometimes overbearing left hemispheres, should make any resulting joy comparatively pale and incomplete.