The government has apparently decided, in its infinite wisdom, that what the American economy really needs is more homebuyers with no equity.

Since our minds are smaller than the world, the world tends to be more complicated than our mental models of it. Yes, sometimes we think things are more complex than they really are, but far more often reality is more complex than we appreciate. All else equal, since far mode makes us neglect detail, it tends to make us think things are even simpler, thus increasing our error. So far mode is a major source of human overconfidence.

Missouri voters have voted against the federal mandate in ObamaCare requiring everyone to buy health insurance. Not surprisingly, they like their current health care more than ObamaCare. The problem is that the current health care system is not sustainable. The American people need to eat spinach. But Obama sold health care reform as if it were chocolate cake. It’s not. It’s spinach and a particularly distasteful kind of spinach and most people realize it. Strangely enough, people prefer chocolate cake to spinach. Part of me finds the Missouri vote comforting. But we shouldn’t to cheerful that the status quo has been preserved. Something’s gotta give. The spinach is coming.

The real threat to a robust recovery on the labor side has come from employer and entrepreneurial fears that once the economic environment improves, a Democratic Congress and administration will pass pro-union and other pro-worker legislation that will raise the cost of doing business and cut profits. In this way the obvious pro-union-pro-worker bias of the present government has contributed to a slower recovery, especially in labor markets. This helps explain the depressingly slow decline in unemployment rates and in the number of workers who have given up looking for jobs.

So understand the implications: the parties to securitization have so screwed up the procedures that they set up that it is pretty much impossible to foreclose (in the 45 of 50 states where the note is the critical element of the transaction) unless they forge documents. That’s fraud, pure and simple. And Freddie and Fannie continue to enable it.

It’s a good reminder to be humble about what we say about policy. Even if you’re trying to be as fearlessly honest with yourself as possible, it is almost certain that you are overweighting some intuitions, and missing other forces entirely. Does that mean that we should never do anything? Well, I’ll leave the debate about how much such humility should curtail our actions for another day. Right now, I’ll settle for noting that it should curtail the terms of debate. Think just how certain most of the predictions were, in both these cases. And in both these cases, the people advocating for a given action based on their certitude were simply 100% wrong. Not because conservatives, or liberals, are espeically (sic) stupid or ignorant. But just because the universe is so complex that it can almost always find a way to surprise us.

Defenders of Cuba like to point out that they have a great education system and a great health system. Even if this is true, this graph reminds us that in a poor country being really good at one thing means being really bad at other things.

Consider a man who spends long hours at the gym. He does so for the same reasons that another man spends long hours at work: to gain an advantage and a sense of achievement. Are gym-man’s broad shoulders, bulging biceps, and ripped torso appropriate objects of envy by couch-potato man? Is this envy a social problem demanding government action? Should gym-man be scorned as greedy for working extra-hard to improve his physique – extra-hard work that likely wins gym-man disproportionate access to attractive mates? Should government force gym-man to share his beautiful babes with couch-potato man? Should gym-man’s muscles, or natural good looks, be taxed? If we recognize that envy of other persons’ physiques is a sentiment deserving only ridicule, why do so many “Progressives” excuse – or even positively approve of – envy of other persons’ monetary assets?