Possibly my "rational" is his "system two."

A young colleague and I recently reviewed the experimental literature, and concluded that the empirical controversy about the reality of cognitive illusions dissolves when viewed in the perspective of a dual-process model (Kahneman and Frederick, 2002). The essence of such a model is that judgments can be produced in two ways (and in various mixtures of the two): a rapid, associative, automatic, and effortless intuitive process (sometimes called System 1), and a slower, rule-governed, deliberate and effortful process (System 2) (Sloman, 1996; Stanovich and West, 1999). System 2 'knows" some of the rules that intuitive reasoning is prone to violate, and sometimes intervenes to correct or replace erroneous intuitive judgments. Thus, errors of intuition occur when two conditions are satisfied: System 1 generates the error and System 2 fails to correct. In this view, the experiments in which cognitive illusions were "made to disappear" did so by facilitating the corrective operations of System 2. They tell us little about the intuitive judgments that are suppressed.

Consider the classic ultimatum game. People go with their gut, and accept what's fair, or reject what's unfair.

They don't do that "rationally", but we can rationalize it. We can sat that evolutionary game theory would lead to that kind of outcome, where our behavior is meant to shape the (tit for tat) the response of people we'll probably meet again, in a day or two.

I find Thaler's book (Winner's Curse) loaded with brain-rules that work, and in many cases are positive and compassionate, without being actually "rational."

The older generation does, until it dies off. The younger incorporates Thaler's work.

Thaler's work (and that of most people wroking behavior economics/finance) is not on irrationality. And I think you are overstating the case in regards to behavioral economics/finance.

It is only "irrational" in that people's behavior is deviating form Homo economicus. For example, Kahneman's Prospect theory is designed to explain why people buy car insurance and buy lottery tickets. Homo economicus would say that people should buy car insurance and not buy a lottery ticket while at the same time invest their wealth conservatively.

If you want to call that irrational, deviation from Homo economicus, then fine. I disagree in that it is still rational, it just fit the definition many economists use.

Oh, and Kahenman, et. al. in the behavior school....they use the "as if" approach too.

That said, go to fact check org on the Clinton years.

It feels right that the Dems are the spenders. It is facty. But it is not actually factual.

I don't play poker, you'd kill me.

Want to tee it up????

I know. (blushing)

"perhaps you will be well versed to visit a deficit spending chart over the last fifty years and then you can share with us minions what you learn."

Uhhh..I have one in front of me....So, minion, its ugly under all conditions and political regimes. Do you have a point, or are you pointless?

Did I strike a nerve, Rahdrool?

Oh, I understand it: P-O-L-I-T-I-C-S.

Oh, I think before its over we will see that the effect of much of the spending bill..excuse me, "stimulus bill," will be ill timed, coming on after the problem has subsided.

"That's the way they get lower costs and cause less crowding out."

Crowding out? The Chinese obviated that issue years ago.

"The real problem is that the Bush administration spent like they were in a downturn, and now leave us without surpluses when we do actually need them."

Spent like they were in a downturn? How about like drunken sailors? I hold no brief for the spending posture of Bush. But every bone in my body tells me we've seen nuthin' yet. The Democrats are in charge, after all........and now we are talking spending pros. Amateurs step aside please.

Then for what reasons?

But seriously Steve and Drew, you're wasting photons arging with someone who is going to gainsay whatever argument you make and, of course, blame it on Bush.