Author Archives: Jason

About Jason

Jason R. Koepke is Founder and Data Strategist at GNT LLC, a risk-analysis and data strategy firm that provides analytical and technical services to the public and private sectors. His work and research has been featured in the academic, financial, and technical industries.

Unnoticed Impact of the US Recession

Yes, we’re in a recession. And it’s going to get a whole lot worse.

But the main reason I post is to send readers through the Internets to a Grace Undressed-a well-written and in-depth blog by a stripper, which I came across probably via BoingBoing–post on how strippers are massively crunched in the current economic situation. The anecdotal-based point of the post is that less people are going to strip clubs and spending less. Not only is this interesting insight into the adult services industry, but it is a simple and low-level (i.e., no more trickling to be done) example of how much trouble U.S. consumers are in.

On the economies of adult services, I have argued for some time that strippers must be a huge source of U.S. productivity increases (assuming that their incomes correctly make their way into the relevant statistics). Consider the fact that their income is predominately tip based and, unlike waiters and waitresses, not based on a percentage of another good (e.g., food) that can increase in price (given inflation, etc.). Furthermore, the form of currency constrains their income stream. That is, a buck per dance per gent is traditional because you can’t slip coins into a garter belt but there’s only moderate incentive for the viewer to provide more dollars per dance. As a result, strippers probably had a much higher labor value years ago than today.

Because of the diminishing value of their labor (i.e., one dance has been, is, and probably will generate one dollar per viewer), they must work much harder to maintain the same quality of life. This squeeze is why I suspect they are a major contributor to productivity growth.

Of course, this isn’t a robust argument. It’s an analysis of logic with almost no case studies (let alone large-n datasets). Furthermore, people are probably providing more than one dollar per dance, meaning that a stripper’s income is more correlated to inflation/price changes than I make it out to be in this post. Last, the likely emergence and growth of additional services (e.g., VIP rooms, table service, non-sexual escorting) mean that strippers have probably found new more profitable revenue streams that make up for lower margins (just like any other successful business).

In any event, it’s a stimulating issue to think about.

A Logic Check In Time For The Presidential Elections (But Too Late For Many People)

In reading through the current issue of Foreign Affairs (July/August 2008), I came across Colin H. Kahl and William E. Odom’s When To Leave Iraq piece, which is an interesting argument for the evolution of the situation in Iraq, primarily the so-called Sunni Awakening. The idea is that the Democratic Congressional victories in November 2006 contributed to an improvement in relations between the US military and Sunnis. This idea is new to me and interesting in that it has important security implications. One example of this is the Spain thesis, an argument that emerged after the Madrid bombings, that voting to withdraw from a counter-terrorism operations (or whatever we want to call it) is antithetical to peace. The second example of how this Democratic peace (heh) argument is important is that it dramatically shifts–not necessarily through ideas but through evidence–the domestic debate regarding which party would do a better job at ensuring US security and peace in Iraq. Below is the relevant selection of text from the article:

The Awakening began in Anbar Province more than a year before the surge and took off in the summer and fall of 2006 in Ramadi and elsewhere, long before extra U.S. forces started flowing into Iraq in February and March of 2007. Throughout the war, enemy-of-my-enemy logic has driven Sunni decision-making. The Sunnis have seen three “occupiers” as threats: the United States, the Shiites (and their presumed Iranian patrons), and the foreigners and extremists in AQI. Crucial to the Awakening was the reordering of these threats.

At the same time, U.S. forces had to convince the Sunnis that they were not occupiers — that is, that they did not intend to stay forever. Here, growing opposition to the war in the United States and the Democratic takeover of both houses of Congress in the November 2006 elections were critical. Major General John Allen, the Marine Corps officer responsible for tribal engagement in Anbar in 2007, recently told me that among Sunni leaders, the Democratic victory and the rising pro-withdrawal sentiment “did not go unnoticed…. They talked about it all the time.” According to Allen, the marines, from top to bottom, reinforced the message sent by the Democratic takeover by saying, “We are leaving…. We don’t know when we are leaving, but we don’t have much time, so you [the Anbaris] better get after this.” As a result, U.S. forces came to be seen as less of a threat than either AQI or the Shiite militias — and the risk that U.S. forces would leave pushed the Sunnis to cut a deal to protect their interests while they still could. As Major Niel Smith, the operations officer at the U.S. Army and Marine Corps Counterinsurgency Center, and Colonel Sean MacFarland, the commander of U.S. forces in Ramadi during the pivotal period of the Awakening, wrote recently in Military Review, “A growing concern that the U.S. would leave Iraq and leave the Sunnis defenseless against Al-Qaeda and Iranian-supported militias made these younger [tribal] leaders [who led the Awakening] open to our overtures.” In short, contrary to the Bush administration’s claims, the Awakening began before
the surge and was driven in part by Democratic pressure to withdraw.