I think the key is "feedback loops". We're not failing to price in inherent differences, out of some moral ideal - we're trying to fix a larger inefficiency, which is that some groups of people are unable to reach their full potential. It's not a cost - it's an investment. It's regulation to fix a negative externality.

[digression into risky territory, here be dragons]

...at least, that's the idea if you believe that racial differences are 100% socially constructed. It gets super tricky if it turns out there is an inherent component, which is why the very idea is such a taboo. It wouldn't be especially shocking, from a scientific standpoint, if it turned out that different "races" tended to have subtly different inherent personality traits that might be of interest to creditors or insurers. But it would cause major headaches, if you want to convince people to break those feedback loops! Even if the inherent differences are only a seed, and the feedback loops account for most of the differences in outcome, you have a massive "political" problem on your hands.

You mention racial differences and the sensitive point about biological differences. But I think there is another kind of racial differences that is not biological - the situational differences. The situation is different for every person, and - on average - for every race.

Depending on the situation the same people behave differently. So it's not the skin color in itself but the different context that makes races behave differently. Being poor or uneducated for example is a better prediction of defaulting on payments, but race, wealth and education are correlated.

The affordances of the context influence choices - how many good options vs bad options you have in your situation. For example, people who would behave perfectly OK in normal life might try to cheat the system to get vaccinated sooner. Because they only got bad options, they might pick a bad behavior. "I got no choice!" Equality of opportunity, and not of outcomes, seems to me the best approach.

The reverse of this is also happening - in the more developed and feminist leaning cultures fewer women choose to do scientific research. Why? They got better options, so many great choices to pick from. It's insulting to question people's choices when they are made in an abundance of good options, as if they were children who can't make their own decisions.

Doesn't need to be inherent to "races". Why wouldn't culture / way of living be the elephant in the room?

well, you could change your culture/way of living. But you can't change your race. If it turned out that race is indeed a component, with proven confidence and evidence, that indicates financial stability or security, then being the wrong race will cause problems for you.

But then on the flip side, if you look at say, athletic selection for a sport like basketball or athletics, you'd find that race is inherently a criteria, because certain races seems to have an inherent advantage (or more correctly, certain races seems to have a _disadvantage). But nobody ever says anything in those cases.

> if you look at say, athletic selection for a sport like basketball or athletics, you'd find that race is inherently a criteria, because certain races seems to have an inherent advantage (or more correctly, certain races seems to have a _disadvantage). But nobody ever says anything in those cases.

I think a charitable explanation for why this is, is sports is pretty much always a voluntary activity, so it's natural to not get as worked up over either implicitly or explicitly favoring a race, compared to, say, doing the same thing in employment or scoring someone's credit, which will almost certainly impact everyone in society involuntarily.

"races" is a cultural concept designed to denigrate certain people.

Using race captures an obvious group of people by how they've already been discriminated against

That is a good summary. An analogy I might add that could further clarify things would be preexisting condition protections for health insurance. Preventing insurance companies from turning down people who they know will require expensive medical care is going to lead to worse pricing for the rest of us. However much of society has decided that is a cost worth enduring in the name of fairness.

Health insurance is weird because it’s become the way you pay for something expected. In every other insurance you will absolutely get denied or charged a huge sum if you’re knowingly going to be a loss.

It’s like applying for home fire insurance and saying you burned down your previous 3 homes and will likely burn down this one.

Problem with this is, this cuts open the feedback loop of being responsible for ones own health. Credit assignment problem all the way

Are you American? Because high cost of health insurance does not deter risky behaviors towards health or a glaring lack of responsibility.

Well, I personally haven't consented to socializing the cost of anything. I'm not sure what the ethical grounds are for imposing this on me, and in so doing dilluting available accuracy of data about people.

These feedback loops you're referring to, what order are you proposing for your chicken and your egg? What's causing what in your view?

> Well, I personally haven't consented to socializing the cost of anything.

This is a strange take. If you had to "consent" to laws there would be utter chaos. The places where you can pick and choose which laws apply to you have no real laws. And all of those places are dangerous and destitute. That's why laws are decided by the majority, there will always be dissenters for every law out there. Some harmless, but others that want to pillage, burn things down, and worse.

There will always be laws that you don't like, unless there's no laws at all.

Here we arrive at the concept of negative and positive rights. You don't have to consent to be subject to laws that bar you from interfering with others. You should have to consent before being forced to provide others with goods and services on the benefit of your labour.

This still doesn't make any sense. Every single government service provided services to people besides you. You're essentially saying there should be no government.

The government plows the streets. Provides police and fire service. Makes sure street lights and sidewalks exist. Handles deeds for property. Handles court cases. If you had to "consent" to all these services providing benefits to other people the entire government would cease to exist.

"I have to consent to anything that doesn't directly benefit me" means a ton of things aren't even going to exist when you actually need them.

I think the deal with feedback loops is that the elements of the loop are mutually causal, which is what makes them feedback loops at all.

Which one of the causes was first in history seems academic and immaterial if we're at t>0 and wanting to devise a strategy to slow it down or stop it.

It's called tyranny of the majority and happens in countries with a weak constitution.

You are consenting by participating in that society.

> So, I don't think you're wrong, but maybe consider if what we're socializing the cost of is worth the price?

But you do not socialize the cost, you just move it on someone else.

For example, we have two people A, B, with risk-assessing algorithm risk1 gives risk1(A) = 3.3, risk1(B) = 2.9. Risk limit for creditors is 3, so person A would not get credit.

But risk1() uses same forbidden information, so we use instead less informed risk2() that got risk2(A) = 2.9, while risk2(B) = 3.1, so now person A would get credit, but person B would not.