[yummyfajitas]

Definitely - one makes more money than the other. If a bank is biased against some group they are turning away profitable customers. This is also purely a statistical problem; once some quant discovers they can make more money by fixing the bias, they'll do it.

Understanding what to expect out of the algorithms is absolutely the wrong way to determine this. The fact is that we simply don't know apriori the optimal way to allocate credit. That's why we need an algorithm in the first place.

[pron]

Or, having realized that algorithms making predictions based on past data are politically conservative (pretty much by definition), if we really want to improve the economy, we should take political action to change the situation. This is how it's always been done, and it can work; sometimes rather well.

[yummyfajitas]

If you want to force banks to make suboptimal credit allocation decisions for political reasons, go ahead and openly advocate for it. And be sure to openly accept blame for it if those loans go bad and we have another banking crisis.

Just don't try to claim you are attempting to eliminate bias. Eliminating bias is a job for statisticians, not politicians.

[pron]

> If you want to force banks to make suboptimal credit allocation decisions for political reasons, go ahead and openly advocate for it

You and I both want to force banks to make suboptimal credit allocations for political reasons (or we both don't). Leaving the local optimum can only be done with coordinated action, but that doesn't mean that your algorithm (that keeps us there) is any less political. By not calling for social action, you are forcing banks to stay in their Nash equilibrium, which is suboptimal for them.

What I want is for us to acknowledge that we have (possibly unintentionally) programmed our algorithms to be conservative, and then make the conscious decision whether we want conservative algorithms or progressive algorithms. Sadly, neutral algorithms are impossible[1] if based on their output we take actions that may affect the distribution of power.

I'm a progressive and I want a progressive agenda. You're a conservative and want a conservative agenda. Both are perfectly fine, but you must understand that there's nothing neutral in your stance. I believe political action for social change often works and can be very helpful, so I wish to encourage it; you believe the opposite, and therefore wish to discourage it. But neither of us is neutral, and your position is not based on math; your math simply serves your position. Your own equations deliberately omit feedback that we know for a fact (through the study of history) to exist. You make assumptions that reflect your conservative values just as I make assumptions reflecting my liberal values.

> Eliminating bias is a job for statisticians, not politicians.

You think that when people talk of social bias they mean statistical bias? This may sometimes happen to be (also) true, but in general, when people talk of social bias they mean any human behavior that creates a dynamics for present and future unfair distributions of power. Sadly, statisticians can't eliminate that. Or, rather they can't eliminate that alone, because politics is not (just) what politicians do. Politics[2] is what we all do when we make decisions that affect the distribution of power in society.

Interpreting statistical snapshots as predictors of future human behavior is not statistics but politics. Statistics tells us what is (or sometimes how things will likely be if we change nothing); certainly not what we should do.

------

[1]: Well, it's possible to pretend some are neutral if we artificially (and incorrectly) reduce the domain of our value functions. In an interconnected system like human society, it is is disingenuous to direct our action based on its outcome for a very limited sector (like a bank), without saying what we want the action to achieve for all other sectors. So, for example, if you ask me if I want bankers to be happy, then the answer is, of course I do. But that doesn't mean I'll favor any action that makes them happy if it also makes other people less happy. My point is that our value functions must be total; we can't be lazy and assign a value to a narrow look at an outcome, but we must assign a value for a complete outcome (i.e. for all of humanity).

[2]: https://en.wikipedia.org/wiki/Politics : Politics... is the practice and theory of influencing other people... Furthermore, politics is the study or practice of the distribution of power and resources within a given community... as well as the interrelationship(s) between communities.

[yummyfajitas]

According to you, in the past, your vague power "theories" predict that "the pattern is long periods of stability". In fact, that's the only concrete prediction you've ever been willing to state.

https://news.ycombinator.com/item?id=9987011

It's "conservative" to take as an assumption a prediction from your "theory"? ("Theory" is in quotes, since you work so hard to avoid testable predictions.)

[pron]

> It's "conservative" to take as an assumption a prediction from your "theory"?

It's not a "theory" any more than the the big bang is a "theory". It is the result of decades (nay, centuries) of research, and I don't see why you'd scoff at it so smugly (and ignorantly). Second, of course it is conservative. As I explained to someone else here, I am not expecting individuals to change their behavior without coordination. Nash equilibria can't be escaped that way anyway. The responsibility is on society. A society that acts to ensure things stay as they are is carrying out a conservative agenda.

I don't think I understand your question, though. Working to keep things as they are is a conservative ideology. Periods of relative stability are a historical fact. Those periods have been no doubt assisted by conservative ideology (although ideology is far from being the only social force), which is nothing new either. Where do you see the contradiction? People, with their opinions and needs and fears and desires and hysteria and ideology and actions and follies are the ones making the system. They are the observers, object and subjects of the system's behavior all at the same time. In a dynamical system with feedback you could be predicting a result, making it, and directing it based on your agenda at the same time. There's perfect coherence here. Look at election polls; they are somewhat similar: they both predict the result and make it, and there's a lot of political agenda involved (or see my examples of some dynamical systems here: https://news.ycombinator.com/item?id=10874683).

How people behave and how they should behave are two perhaps equally interesting but completely different questions. If it is your opinion that people should behave in a way that simply mirrors how other people behave, then yes, your answer to the second question is "according to conservative ideology". If you think that my opinion is that on occasion people should behave in a way that isn't in accordance with their immediate, narrow material self-interest, then you'd be correct. If, however, you think that I think that people often behave this way, then you'd be wrong.

Finally, it's not "conservative" but conservative, just as you are not a "conservative" but a conservative.

[yummyfajitas]

A theory is a machine for making testable predictions (i.e., positive claims that are a reason for rejecting the theory should they fail to be true). You go to great effort to NOT make any testable predictions.

My point is that if your one testable prediction of slow change is true, then using the past to predict the future will be highly accurate. By "accurate", I mean that if the predictor says group X will have a 40% default rate, the empirical default rate of group X will be close to 40%. (I'm assuming a good model is built, etc.) Once in a blue moon (the rapid changes) this will fail, then everyone can re-adjust their models and go back to using the slow change assumption.

This is strictly a positive (i.e., value-free) claim about the world. It's based on your positive belief.

As for your dynamical systems verbiage, feel free to state a testable prediction.