(FORTUNE Magazine) – DECISIONS, DECISIONS

One was suddenly all atremble upon encountering, in the Wall Street Journal, a quite affirmative report on some new software said to help a chap make better decisions as he parades through life. Causing one to quiver while instantly ordering the new software were two thoughts: (1) The program in question sounded like formidable competition for the decision-making software created by the present keyboarder a few years ago, and (2), by a stunning coincidence, we had an important decision to make.

Although not yet distributed commercially or any other way, and reviewed derisively right here at hearth and home, the program we created has a vast potential audience. Called Arbiter and written in the Basic programming language, it was created to deal with the all-too-familiar holiday situation in which the whole family is together and the participants start an argument about which tape to watch after dinner. One faction wants Swingtime with Astaire and Rogers, another wants Mastroianni in La Dolce Vita. There being no "correct" choice, all that's needed is a decision-making procedure perceived to be fair. Also available for settling arguments about which Chinese restaurant to order in from, Arbiter prompts the users to type in the possible choices (up to ten are allowed), then invokes the Basic random-number generator to select one of the options. The program's only discernible weaknesses are graphics (it has none) and a tendency to trigger rebellions by sore losers.

The decision we took up with DecideRight, a product of Avantos Performance Systems, concerned a new Dell notebook computer with an active-matrix color screen. Advertised for less (by $1) than $2,000, the proposition left us all conflicted: lusting to buy but far from certain the benefits outweighed the $1,999 cost. We had in fact some difficulty thinking of computer tasks requiring pizazz on the road. Our three-year-old Toshiba T1800 has a black and white screen and a tired old 386SX chip, but it still gets the job done in word-processing and simple record keeping.

DecideRight first asks you to describe the decision, then prompts you to list the available options. We listed two: (1) spring for the Dell notebook and (2) continue to get by with the Toshiba. Then the program asks you to mention the criteria you are bringing to the decision. Here we listed three: (1) dollar cost, (2) business necessity, and (3) fun. Next you are asked to assign weights to these criteria. One does this by clicking someplace along a horizontal scale representing values of 0.00 through 10.00. Our clicking resulted in weights of 5.07 for cost, 4.08 for business necessity, and--arguably stacking the deck in favor of Dell--9.57 for fun.

Finally, DecideRight forces you to estimate how well each of your options rates on each of your criteria. Buying the new machine rated a 5.13 on business necessity, a 5.32 on cost, and a 9.71 on fun. Standing pat with the Toshiba garnered 5.21 on business necessity, 9.77 on price, and 0.00 on fun. All of which brings you to the last step: printing out DecideRight's conclusion.

Friends, we couldn't believe it. Incredulously, we read the program's pitiless judgment: "Based on a careful evaluation of how well each of the two possible choices could meet the three major criteria considered, Get By With Old Toshiba Laptop appears to be the best choice."

As we write, the new laptop is on its way to the present sore loser. Dare he mention that a few optional features brought the price to almost $2,600?

ASK MR. STATISTICS

Dear Statmeister: I am a research psychologist specializing in addictive gambling and currently working for Nevada gaming interests. I have just one question: Do you know of any games that are not now being played in casinos but have decent upside potential for getting folks irrevocably hooked? Also, would you kindly adumbrate the house edge in any such games, as I hate to go to my bosses with incomplete research.

NAME WITHHELD, PH.D.

Dear Nonentity: The game you want is computer solitaire, which comes packaged with Microsoft Windows and has already got millions of PC users hooked beyond redemption. Solitaire was of course around long before computers. J.P. Morgan was addicted to the game a century ago and during the panic of 1907 kept right on playing in his library, even as the country's leading bankers came calling to anguishedly plead that he save the country or at least their own banks.

A funny thing about the Windows version is that it offers an option in which you play by "Las Vegas rules"--even though solitaire is not offered in casinos in Nevada (or, so far as one can find out, anyplace else in the U.S.). Vegas rules ask the player to imagine that he is buying the deck of cards for $52, then recovering $5 for every card he can "put away." Every once in a while, a player will find he has put away all 52 cards, yielding him a net profit of $208. Most of the time, however, he is getting back much smaller amounts. In an experiment conducted by Mr. Statistics, the single most frequent outcome was a loss of $27, i.e., only five cards were recovered.

In the aforesaid experiment, a fellow with better things to do nevertheless played and recorded the results of 2,100 games, at the end of which he was tentatively prepared to state that the overall house edge was something like 11%, meaning that in an average game the player's loss was around $5.75. The probability of hitting the $208 jackpot appeared to be one in 33.

It seems incredible, but even after all that play, those figures still do look tentative. One problem is that the present addict is human and occasionally makes mistakes (e.g., not noticing that a card could be put away), so his own results may not be an ideal baseline. Beyond that, it is unclear what mistake-free play would look like. For all its surface simplicity, the game has a deep strategic dimension, and there is obviously room for argument about which strategies work best. Sometimes, but not other times, it pays to take back cards earlier put away, endeavoring thereby to free up buried cards that may increase the player's final total. An online query floated to statistics professors on ProfNet, the consortium of academic experts, yielded up nobody knowing how to directly calculate the house edge in a perfectly played game.

We do, however, cherish an answer E-mailed back from the University of Kansas, where a fellow solitairist confessed to envying our own situation and noted, correctly: "At least you're putting your addiction to good use, with a story."

INDUSTRIAL POLICY REDUX

We were at risk of somnolence during the February 15 cattle call in Manchester, New Hampshire, when one of the GOP presidential aspirants suddenly grabbed our attention, and not only because he happens to be the only (and last) politician to whom we ever gave money. This transfer payment was supposed to make it possible for Alan Keyes to beat superliberal Paul Sarbanes in Maryland's 1988 U.S. Senate race, but its only discernible outcome around our house has been mailbox superclutter attributable to conservative fundraising. Anyhow, what brought us wide awake was Alan's pithy summation of a thought we had been creeping up on ourselves while glumly listening to the rhetoric of Pat Buchanan, Bob Dole, and several other longhorns. Said Keyes: "They sound like a bunch of socialists."

Who'da thunk it? That Pat Buchanan would come off talking like dirigiste Labor Secretary Robert Reich when the subject is wages and profits? Or that Bob Dole would feel obliged to echo Pat? Or that one could suddenly discern a scenario wherein "industrial policy" is back onstage?

Remember that phrase? Promoted back in the period around 1980 by Felix Rohatyn, Business Week, and Teddy Kennedy, industrial policy was for several years hot stuff on the op-ed pages. Its basic proposition: that U.S. social and economic problems required the federal government to incentivize, cajole, and pressure business into making the right investment decisions--like, say, building factories in depressed areas instead of in the booming Sun Belt. As formulated by Felix: "Some kind of national industrial policy is needed to arrest the decline of our basic industries and...to deal with our failure to compete with other countries."

Industrial policy fell off the table after the Reagan economic boom got going without it, and the term itself is today embraced by hardly anybody. But once again we are hearing of a social and economic crisis said to have been precipitated by the business sector and needing action by government.

The problem this time centers on corporations stated to be not dealing fair and square with their workers. The heart of the matter, according to Buchanan, is "the economic insecurity of the middle class and the falling wages of working-class Americans." Pat keeps coming back to those tumbling wages, says "real incomes of American workers have fallen 20% in 20 years," and says we gotta do something about it.

Reich agrees on the need for action. As we tap in these lines, he is about to confer with the AFL-CIO executive council and palaver about the porkchoppers' new slogan, "America needs a raise." One of his options is tax breaks for companies that act nice toward employees. In a New York Times op-ed piece in January, Reich named another arresting possibility: that "the benefits of incorporation" be reserved for companies sharing more of their profits with workers.

Needing to be stated at about this point is a highly heretical proposition: It is not true that real wages are in long-run decline. In arguing that they are, the Reich-Buchanan axis relies on inflation adjustments made with the Consumer Price Index. And the CPI, as we now know, has been seriously overstating inflation. The Advisory Commission to Study the Consumer Price Index puts the overstatement in a range of 1% to 2.7% a year since 1986. It made no effort to quantify the effect further back in time but says it has apparently been "large" for at least two decades.

When the commission report hit Washington last September, it instantly triggered a great debate about whether social security payments could/should be reduced. But hardly anybody seemed to notice that the errant CPI was also relevant to the chatter about declining wages. Between 1973 and 1995, the Labor Department series on average weekly earnings, as adjusted for inflation by the CPI, did indeed fall by about 20%. But if the CPI was overstating inflation by even 1% a year, then the 20% decline vanishes. At 1.5% a year, it becomes a 13% raise, and at 2% it becomes a 25% raise.

Given the 22-year time span, can these figures be rated terrific? No way. But the figures are not surprising, given the period's generally dismal productivity growth.

Might the adjusted figures suffice to stop Republicans from talking like socialists? Keyes and his contributors can always hope.