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Computing At Chaos Manor:
September 25, 2007

The User's Column, September 2007
Column 326, part 4
Jerry Pournelle jerryp@jerrypournelle.com
Copyright 2007 Jerry E. Pournelle, Ph.D.

Continued from last week...

"Halo 3 guns for $150 million" says today's LA Times Business section. This is how much the XBOX 360 game program will pull in the first 24 hours. Halo 3 cost $60 million to develop. By contrast, Spider Man 3 took in $151 million in its first three days - and cost $500 million to make and distribute. Spider-Man 3 is expected to gross some $1.4 billion over its lifetime, so the producers won't lose money; but wow!

About a year ago Larry Niven and I had lunch with the Halo design team. As I recall I asked them why the Master Chief is unarmed at the beginning of the story, and when the skipper of the doomed ship gives him a pistol, the weapon is not loaded.

That got a laugh, and a patient explanation: If they gave the Chief weapons in that situation the first thing some gamer would do would be to shoot the skipper. "So the game ends in a loss," I said. "Let the little quislings pay for their fun!" That got another explanation I don't recall.

I came away from the lunch wishing them well, as did Niven. I much enjoyed their Myth game series although I wasn't very good at Myth: what I needed was a "pause" command that allowed me to issue orders to all my troops before the game started up again. The wonderful "This Means War!", still one of my favorite real time strategy games, allowed that and made it a game of strategy, not a click fest.

The Bungie people didn't allow you to slow down Myth or pause and give orders because they thought it would make the game too easy. In any event, this view is more appropriate for a first person shooter like the Halo series.

All this is interesting, but it does give one to think about the state of the economy: to play Halo you will need an XBOX 3. And Halo 3 expects to bring in $125 million in 24 hours. Perhaps there is more disposable income out there than we suppose? Which brings us to this week's essay.

Are We All Professional Gamblers?

The headline lead column on the front page of the editorial section of this week's Daily News (link) says "In California, the rich get richer, the poor get poorer, and the middle class is disappearing." Certainly an alarming situation if true, but what does it mean?

According to the article, pay for high end jobs requiring college degrees has grown rapidly - that's the rich getting richer, I guess - while wages for unskilled labor in the fields, carwashes, restaurants and hotels have risen only slightly. That's the poor getting poorer. (Actually, it's both getting richer but the rich getting richer faster; although with inflation you can argue that the lower and lower middle classes aren't getting richer at all. On the gripping hand, if you add in government benefits and entitlements, the picture changes again - or will until the government goes broke. But all this is for another time.)

Clearly the writer, thomas d. Elias (sic) has never studied elementary economics. Someone should tell him about supply and demand: when you import lots of unskilled laborers, the supply goes up, and demand (as expressed by wages) falls or at best remains stable. California imports more uneducated and unskilled laborers than anyone else, so the effects are easy to see here.

Another of his examples are foreclosures: in wealthy neighborhoods where homes demand high prices, there aren't many foreclosures; while in Riverside and other lower middle class neighborhoods, foreclosures are at an all time high. Astonishing. In places where people were encouraged to think of their houses as ATM machines and inveigled to borrow out the equity they had in the house for vacations and prom dresses, the collapse of the housing market spells disaster; but then who ever thought it would be different?

Even so, if we didn't have a continuous over-supply of unskilled labor flowing into the state, wages would rise across the board, and many who are losing to foreclosure might manage to make enough to survive despite their bad choices. "The poor watch as whatever equity they've built up over years of making house payments disappears in a price slump, and then often have to abandon their homes when monthly payments on some subprime mortgages rise after three or five years of requiring only interest."

Well - yes. If you buy a house with nothing down, and interest-only payments for years, you won't have any equity in the place unless the housing market continues to rise. Those who buy in hopes of rising prices are known as speculators. When I was young we learned a lot about speculators and what President Andrew Jackson thought of them. I left 8th Grade US History with a healthy skepticism about speculators: as a result, I didn't get in on the dot boom (although I admit that I did buy some $20/bbl oil futures on the advice of Access to Energy; but that didn't seem so much like speculation as a gift). I didn't really get in on the dot boom, but I avoided the dot bust.

When I became a full time writer with no day job, Robert Heinlein, a good friend, told me "we're professional gamblers. Make sure your house is paid for and your car is paid for. Don't go into debt." And when I got my first best-seller, Robert warned me that it wouldn't happen every year and I shouldn't get used to spending as if I had that kind of income.

Those were the days when people got jobs and kept them, working 30 or 40 years for a gold watch and pension. They didn't feel like professional gamblers. They thought they were contributing to the welfare of the nation.

Things have changed since then, and most of us are professional gamblers. Those with secured pensions may be safe, as are those with tons of money in a diversified portfolio; but it's not clear who else is safe. The computer revolution has changed much; and Global Free Trade has changed the rest. The day when you could count on a fair day's pay for a fair day's work are pretty well gone, because your employer will, if he can, ship your job overseas where he can get a day and a half's worth of work for half a day's pay, and you can go look for something else to do.

That's grim enough: but add to that the unlimited import of unskilled workers to keep the bottom wages low, and even those who thought themselves middle class have become professional gamblers. Ask yourself: do you do anything that a younger person looking for a job won't do for less? If the answer to that is no, then you're a professional gambler; and prudence requires you to make some contingency plans - and to be very careful about becoming a speculator. You may already be a speculator.

Whatever Were They Thinking?

You can get free email; just let someone read your mail and send along advertisements related to what you're talking about in mail. Come now a scheme to get free phone calls: just let them tap your phone, listen in on the call, and generate advertisements to appear on screen. Wow!

[ New York Times link ]

I suppose this will make a ton of money. There seem to be a fair number of users of free mail services that do the same thing.

I wonder if the people who use this phone service will also join movements to denounce government phone taps?

Winding Down

The movie of the month is Stardust. It has stiff competition, but it may be the movie of the year. It is certainly one of the must see movies of 2007.

Stardust is hard to describe. It doesn't fit any genre. The story takes place some time in the 19th Century in Britain, but it draws from classic fairy tales. The land of Faerie is not far away, and you can visit it if you dare, and if you are clever enough. A naive young man of no obvious talents or abilities decided to visit Faerie to get a fallen star. His object is to impress a shallow young lady in the hopes of winning her hand in marriage.

No one visits Faerie and leaves unchanged. Our unremarkable young man grows up in the course of a week. He has a series of remarkable adventures, meets some of the most interesting characters you'll ever see, defeats a wicked witch queen, and shows us marvels we will not soon forget. Every piece of this crafted film is relevant to the story line. There are marvels, and they're all important. Highly recommended.

The book of the month is The Scientist as Rebel, by Freeman Dyson. Dyson may be the sanest man on the planet. That doesn't mean I agree with every conclusion he comes to, but it does mean that you must take him seriously. This book grew out of a series of book reviews and essays, but it has a coherence you wouldn't expect given its origin. If you have any interest in science, history, or philosophy, you will find there's not a dull page in this book.

O'Reilly has acquired Pogue Press and "The Missing Manual" series. If you have any interest in the iPhone, you will find David Pogue's iPhone The Missing Manual worth your while. If you have an iPhone I suspect this book will tell you things about it that you didn't know; but the main value may be for those who don't have an iPhone and are wondering if they want one. The book will certainly tell you what the iPhone can do as well as its limits.

I keep swearing that one day I will take a powerful system and install Linux on it, and see just how well I can get along using Linux and nothing else. If I do I will need Rickford Grant's Ubuntu for Non-Geeks from No Starch Press. . My Linux expert friends tell me that Ubuntu is the proper Linux distribution to install, and this book is the right way to learn about using it. Linux isn't just for geeks any more...

The game of the month is still World of Warcraft. I'm still having fun with it, although I haven't advanced very far, largely because I keep inventing new characters.