Capital isn’t a thing

Sunday, August 3rd, 2014

Capital isn’t a thing, Eric Falkenstein says — it’s a ledger, a way of determining who gets the make decisions about various things, and who gets the fruits of those things:

The fact that a minority has most of the power to decide and access the fruits is a consequence of a past where individuals anticipated a future where such a ledger would continue to be valid. It’s always been popular to think, maybe we should have a jubilee, get rid of those ledgers and start again as equals! Given the power law distribution of wealth at all times such a proposal is perennially popular to those ignorant of history. Yet, if you do this every period, capital isn’t owned by any individual, and so would be completely mismanaged as happens in societies without stable property rights. If you do this at all you can expect an immediately higher default premium which would make an economy undercapitalized. Luckily, our Founding Fathers specifically anticipated these problems and so emphasized the republican nature of our government, not making everything a democratic process.

All Men Seek to Rule

Saturday, August 2nd, 2014

Status-seeking is a human universal, Eric Falkenstein reminds us:

The anthropologist Harold Schneider studied hunter gatherers and noted they had an almost absence of hierarchy, which he saw as the resulting from the maxim that ‘all men seek to rule, but if they cannot, they seek to be equal.’ It’s a reasonable solution for a society without division of labor.  Unfortunately many progressives see the world the same way, and thus like the Rawlsian solution that everyone has the same outcome regardless of one’s talents or wealth. Now, that’s fine for a camping trip, but in modern society unnecessarily.

Reality shows like Top Chef, Project Ink, Project Runway, or Deadliest Catch show people passionate about activities I do not care about in the least, all private sector jobs. With thousands of different remunerative specialties that complement each other, this allows us to focus and then trade with others to get the benefits of other’s specialization focus. In modernity status isn’t limited to one dimension, and so you can be an important part of something bigger than yourself without joining a religion: you are part of a complex network of specialists in a market economy of individuals maximizing their status in their own individual way.

Everyone wants to live on in the future in some way, as part of heaven or something worldly that needed or at least appreciated you. If you obey the laws and social norms, including The Golden Rule, and generate more revenue than you cost, you are making your tribe better off. The egalitarian solution where we have a single-payer state for everything has no risk, but like Hegel’s farmer, promises little potential for self-actualization or what the Greeks called arête (‘excellence’), which in the modern world is consistent with specialization, trade, and productivity growth (arête incents one to do things better than before).  We shouldn’t base our norms on hunter gatherers, which is why most people don’t.

The SciFri Book Club Reads Dune

Friday, August 1st, 2014

NPR’s SciFri Book Club has started discussing Dune:

Join sci-fi author Kim Stanley Robinson and astrobiologist and theoretical physicist Sara Imari Walker as they help kick off the club with an introduction to Herbert’s “Duniverse.”

Kim Stanley Robinson asks the first discussion question:

What do you see in the book that is a funhouse mirror reflection of our world right now?

Not More, Better

Friday, August 1st, 2014

The government spends about 35% of GDP in the US today, Eric Falkenstein notes, and heavily regulates the rest:

It would be far better if, instead of thinking about new tricky ways to squeeze the rich, we instead set government spending to some fraction (say 35%) of the past 5 years of GDP and no more. The endless arguments about the level would stop, and it’s interesting to note that over the past 30 years in the US federal revenues as a percent of GDP has been remarkably consistent across various administrations. By using a moving average of historical GDP this would make spending countercyclical, most importantly instead of politicians being elected for their ability to promise ‘more’ they would instead focus on ‘better.’ That is, it would be nice if the politicians argued about better ways to allocate spending rather than about more or less in aggregate; the net result of the ‘more’ approach has been those who are good at articulating why we need more find they have no idea how to spend it, as when the government had $800B to spend in stimulus, most of it simply went to shoring up state budgets, meaning, state pension deficits, which is just an income transfer to state employees from future taxpayers.

Meditations On Moloch

Thursday, July 31st, 2014

Scott Alexander presents his meditations on Moloch, referring to Allen Ginsberg’s Howl:

What has always impressed me about this poem is its conception of civilization as an individual entity. You can almost see him, with his fingers of armies and his skyscraper-window eyes…

A lot of the commentators say Moloch represents capitalism. This is definitely a piece of it, definitely even a big piece. But it doesn’t exactly fit. Capitalism, whose fate is a cloud of sexless hydrogen? Capitalism in whom I am a consciousness without a body? Capitalism, therefore granite cocks?

Moloch is introduced as the answer to a question — C. S. Lewis’ question in Hierarchy Of Philosophers — what does it? Earth could be fair, and all men glad and wise. Instead we have prisons, smokestacks, asylums. What sphinx of cement and aluminum breaks open their skulls and eats up their imagination?

And Ginsberg answers: Moloch does it.

There’s a passage in the Principia Discordia where Malaclypse complains to the Goddess about the evils of human society. “Everyone is hurting each other, the planet is rampant with injustices, whole societies plunder groups of their own people, mothers imprison sons, children perish while brothers war.”

The Goddess answers: “What is the matter with that, if it’s what you want to do?”

Malaclypse: “But nobody wants it! Everybody hates it!”

Goddess: “Oh. Well, then stop.”

The implicit question is — if everyone hates the current system, who perpetuates it? And Ginsberg answers: “Moloch”. It’s powerful not because it’s correct — nobody literally thinks an ancient Carthaginian demon causes everything — but because thinking of the system as an agent throws into relief the degree to which the system isn’t an agent.

Bostrom makes an offhanded reference of the possibility of a dictatorless dystopia, one that every single citizen including the leadership hates but which nevertheless endures unconquered. It’s easy enough to imagine such a state.

Power to the People’s Proxies

Thursday, July 31st, 2014

Democracy does not decentralize power to the people, Eric Falkenstein finds — it does the opposite:

As the Occupy movement showed, unorganized mass movements get nothing done, so successful parties are those that channel public legitimacy into a small set of essential rights too important to be outside state dominion. Go to a school board meeting and watch how insiders anticipate idiotic comments from the rabble, and so control the outcome to make such meetings basically Potemkin village town halls. Eventually the organization-committed people take over the organization and the mission-committed people become frustrated and leave (see a description of the recently created regulator CFPB’s quick descent into solipsism). They set up national plans for health care, education, energy, etc., and slander choice and variety as a ‘race to the bottom.’ Thus, teachers unions and Medicare/Medicaid focus on preventing choices that might take away from centralized power, competition from other providers and exit by consumers is outlawed.

Roman and American Immigration Comparison

Thursday, July 31st, 2014

Roman conservatives fought against extending citizenship even more violently than their American counterparts, Randall Collins notes, but they still lost:

True, the conservatives had the law on their side; and they were right when they accused reformers and ethnic aliens of breaking the law. But the laws were made in their own interest by the conservatives, and their unwillingness to reform made the struggle turn outside legal channels.

The country which is the world center, where wealth and power is concentrated, is inevitably a magnet for those who are poorer and less privileged. Sometimes the magnet does it own expanding, just as the Roman alliances and conquests brought more territory under Roman control, and attracting even more people to Rome. The USA expanded in much the same way, from colonial times, through the Indian Wars, to the Spanish-American War (when we got Puerto Rico, Hawaii, Guam, and the Philippines). Today’s struggle to secure the Mexican border is the same struggle that started in the 1830s, only then it was ethnic Anglo-Americans who settled on Texas land that the Mexican revolution had inherited from the Spanish empire. All the borders that we are militarizing now against illegal aliens — from Texas and the Southwest to California — were part of the peace treaty that ended the Mexican-American war in 1846, including the Rocky Mountains states on up to Oregon. It was the biggest land conquest in our history; but the geography is the same and people are still moving across it.

A wealthy and powerful country attracts outsiders not only for economic reasons, but because of its prestige. Its lifestyle becomes dominant in the world, setting the standards others imitate, and especially when its citizens have the most rights. Its magnetic attraction for outsiders operates whether peacefully or in the aftermath of its conquests. It has been the same with the other great colonial empires, England and France, both of whose homelands became flooded with immigrants from their former colonies.

Bottom line: as long as the USA is rich and dominant, immigrants will keep on coming, by legal means or illegal.

And the historical lesson is there is nothing that can be done to stop it. Nothing humane, at any rate; doggedly conservative states that stake their identity upon ethnic purity become the nastiest of regimes; when they succeed, it is only through the moral outrages of ethnic cleansing and genocide. America is unlikely to go that route, above all because we have already gone through so much ethnic assimilation in the past so that universalism has become one of our celebrated values.

The Roman comparison shows a silver lining. Despite their violent struggles over citizenship, the aftermath was surprising rapid in putting the issue behind them. Within a generation after full citizenship was granted, ethnic divisions were no longer important for Romans. If we can get to the same resolution, the time-table of our future should be about the same.

And with those struggles behind it, Rome was finally able to flourish. Right?

When Middle East Conflicts Become One

Wednesday, July 30th, 2014

In 1979, the Israeli-Palestinian situation was fluid, David Brooks says, but the surrounding Arab world was relatively stagnant:

Now the surrounding region is a cauldron of convulsive change, while the Israeli-Palestinian conflict is a repetitive Groundhog Day.

Here’s the result: The big regional convulsions are driving events, including the conflict in Gaza. The Israeli-Palestinian conflict has become just a stage on which the regional clashes in the Arab world are being expressed. When Middle Eastern powers clash, they take shots at Israel to gain advantage over each other.

Look at how the current fighting in Gaza got stoked. Authoritarians and Islamists have been waging a fight for control of Egypt. After the Arab Spring, the Islamists briefly gained the upper hand. But when the Muslim Brotherhood government fell, the military leaders cracked down. They sentenced hundreds of the Brotherhood’s leadership class to death. They also closed roughly 95 percent of the tunnels that connected Egypt to Gaza, where the Brotherhood’s offshoot, Hamas, had gained power.

As intended, the Egyptian move was economically devastating to Hamas. Hamas derived 40 percent of its tax revenue from tariffs on goods that flowed through those tunnels. One economist estimated the economic losses at $460 million a year, nearly a fifth of the Gazan G.D.P.

Hamas needed to end that blockade, but it couldn’t strike Egypt, so it struck Israel. If Hamas could emerge as the heroic fighter in a death match against the Jewish state, if Arab TV screens were filled with dead Palestinian civilians, then public outrage would force Egypt to lift the blockade. Civilian casualties were part of the point. When Mousa Abu Marzook, the deputy chief of the Hamas political bureau, dismissed a plea for a cease-fire, he asked a rhetorical question, “What are 200 martyrs compared with lifting the siege?”

Democracy in Moderation

Wednesday, July 30th, 2014

Democracy, like all things, is good only in moderation, Eric Falkenstein says — it is a means and not an end:

Taken to an extreme it is highly dysfunctional, as decisions are not helped by making them mass plebiscites or town hall meetings.  Go to a school board meeting and watch how quickly thoughtful discussions get sidetracked. Philip Howard’s Rule of Nobody outlines an interesting consequence to increasing public participation in big decisions. As the number of stakeholders grows each interest group seeks its own group’s ends without moderation, they are single-issue advocates nobly advancing their righteous cause (e.g., Native Americans, aquifers, unions), and so veto action unless they are basically paid-off. The result is that usually nothing happens, and so the days when we could build the interstate highway system, the Hoover Dam, or the Empire State Building in only a year, are over.  Small ‘d’ democratic control of property leads to stasis, why government spending today is mainly on transfer payments and studies, not roads and bridges.

Successful Ethnic Assimilation

Wednesday, July 30th, 2014

Rome’s was a surprising example of successful ethnic assimilation, Randall Collins suggests:

After about 60 BC, most of the famous authors and politicians had been born outside of Rome: Cicero, Catullus, Virgil, Horace, Livy, and Ovid all came from remote parts of Italy. During the following centuries of the Roman Empire, virtually none of the famous names were born at Rome, and they came not only from Italy but from the provinces. At least in the wealthy and educated classes — the only people that we hear about in the histories — ethnic distinctions had disappeared. Latin became the universal language throughout the western provinces; all traces of local cultural identities disappeared. In the eastern part of the Empire, where the provinces had been under Greek-speaking rulers, Greek continued to be spoken but Latin was used in official matters. With the end of a few areas of die-hard resistance, one hears no more of ethnic nationalist movements. The upper classes and the upwardly mobile, at any rate, lived their lives as Romans.

And They All Lived Happily Ever After?

Well, not exactly. The rich kept on getting richer, the poor more displaced from anything except seeking handouts. Generals became politicians and vice versa. Although the ethnic citizenship issue was settled, the struggles turned into civil wars over personal power, until domestic peace was finally established by a hereditary monarchy.

Boas Wasn’t Boasian

Tuesday, July 29th, 2014

When anthropologist Franz Boas died in 1942, his Boasian school had been defined by Ruth Benedict, in her book Patterns of Culture:

The word “define” may surprise some readers. Wasn’t Boas a Boasian? Not really. For most of his life he believed that human populations differ innately in their mental makeup. He was a liberal on race issues only in the sense that he considered these differences to be statistical and, hence, no excuse for systematic discrimination. Every population has capable individuals who should be given a chance to rise to the limits of their potential.

He changed his mind very late in life when external events convinced him of the need to fight “racism,” at that time a synonym for extreme nationalism in general and Nazism in particular. In 1938, he removed earlier racialist statements from his second edition of The Mind of Primitive Man, and the next year Ruth Benedict wrote Race: Science and Politics to show that racism was more than a Nazi aberration, being in fact an ingrained feature of American life. Both of them saw the coming European conflict as part of a larger war.

This is one reason why the war on racism did not end in 1945. Other reasons included a fear that extreme nationalism would lead to a second Hitler and a Third World War. How and why was never clear, but the fear was real. The two power blocs were also competing for the hearts and minds of emerging nations in Asia and Africa, and in this competition the West felt handicapped. How could it win while defining itself as white and Christian? The West thus redefined itself in universal terms and became just as committed as the Eastern bloc to converting the world to its way of life. Finally, the rhetoric of postwar reconstruction reached into all areas of life, even in countries like the U.S. that had emerged unscathed from the conflict. This cultural reconstruction was a logical outcome of the Second World War, which had discredited not just Nazism but also nationalism in general, thereby leaving only right-wing globalism or left-wing globalism. Ironically, this cultural change was weaker in the communist world, where people would remain more conservative in their forms of sociality.

Ruth Benedict backed this change. She felt that America should stop favoring a specific cultural tradition and instead use its educational system to promote diversity. To bring this about, she had to reassure people that a journey through such uncharted waters would not founder on the shoals of unchanging human nature.

A Gentle Introduction to Neoreaction (for Libertarians)

Tuesday, July 29th, 2014

Andrea Castillo presents a gentle introduction to neoreaction (for libertarians):

I first learned of these rapscallions after one Steve Sailer left a comment on an old Ümlaut article poking fun at Malcolm Gladwell. The article he had linked was interesting enough, so I added his blog to my RSS feed. Another fellow libertarian! Why not?

But something was amiss. Interspersed among the interesting enough commentary on movies, politics, and demography was uncomfortable discussions of international PISA scores and potshots at feminism—thoughts far from the libertarian brand. I left the comfortable sterility of my RSS reader to do some digging and found a treasure trove of top-shelf heterdox samizdaty badness. His website quickly primes you for what to expect: “Immigration – Darwinism – Race – Sports – Gender – IQ – Mexico – Genetics – Politics – Crime – Interracial Marriage.” Oh my. This intrepid Sailer clearly left no stone unturned. Then of course came the dust-ups with Bryan Caplan. But Steve Sailer was really just an early layer. Things got weirder from there.

Intellectuals should run everything as the vanguard of the people

Tuesday, July 29th, 2014

Liberals consider Piketty’s book a must-read, but only, Eric Falkenstein says, because, like Marx’s Capital, it’s a great safety blanket for Liberal prejudices:

The end-game is exactly what progressive conventional wisdom (e.g., the common New York Times or Harvard professor view) has been preaching for over 50 years: enlarge the state. The key point is a highly credentialed academic wrote a long book proving that some abstruse mathematical inequality (r>g) implies we need to raise taxes on the rich and regulate wealth more democratically. It’s really the debating tactic called ‘spreading’, which is top put forth so many arguments, none sufficient or necessary, that you can always claim victory. For example I could question his many empirical assertions, such as how could German inflation have averaged only 14% from 1913-1950 (p. 545) given inflation was 10^10 in 1923, or how depreciation affects his r/g=C/I steady state equilibrium, but that would leave another 20 assertions unstained, and so those who want to euthanize renteirs can retain faith in their big picture.

Piketty is a modern progressive, best defined as someone who thinks intellectuals should run everything as the vanguard of the people, which is why academics, journalists, and writers are predominantly progressive. Hayek noted that scribes have always been egalitarian, probably always lamenting the fact that the idiots in power don’t write nearly as well as them, and thus, are objectively less qualified but via some tragic flaw in the universe, end up in power. It forms the common reverse dominance hierarchy so common today, where obsequious, hypocritical yet articulate and confident leaders pander to the masses and rule via democracy, focusing their envious eyes on those who aren’t interested in that game, such as those concerned with business, religion, or their own family. As Piketty notes, “if we are to regain control of capitalism we must bet everything on democracy” (p. 573), he says from his inegalitarian and very undemocratic position at the Paris School of Economics.

It never occurs to them that the main problem with subjecting markets to democratic control is that those who end up wielding power will be incompetent or tyrannical, and that ‘the people’ have never ruled directly, only their various proxies. Every totalitarian government of the 20th century has rested on at least the perception of massive popular support, which is why they have all ruled in the name of The People. An unchecked democracy becomes mob rule, which becomes tyrannical and highly illiberal, why the Founding Fathers, so familiar with Greek history, were careful to put checks and balances in the US constitution and emphasize the republican nature of government.

Rome’s Liberals

Tuesday, July 29th, 2014

Rome’s illegal alien problem came to a head after 146 BC, Randall Collins says, when Rome emerged as the hegemon, the dominant state in Mediterranean world:

Partisan factions developed in the Roman elite itself; conservative defenders of the old Republic, but also a “democratic” party in favor of redistributing public land, handouts to the poor, and widening the franchise. These were not merely idealists; they had a strong practical concern, that the basis of the old Roman army — self-sufficient small farmers — was disappearing and needed to be revived. This the reformers never did achieve; but army reform and franchise reform tended to go in tandem. Leading liberals often came from the ranks of the most successful generals, like Marius and Caesar. The first famous reformers were the Gracchus brothers, who ran for the highest office under proposals to extend the Roman franchise to at least some of the nearby Italian allies. Tiberius Gracchus was killed by a crowd of angry senators in 132 BC, as was his brother Gaius ten years later.

The younger Gracchus did succeed in passing a law instituting the dole: the state undertook to import grain to sell to citizens of the capital below market prices. Handouts by the liberal state became permanent, no conservatives being strong enough to brave the crowds’ demand for the staple of food. Rome created the early welfare state, in effect a massive food stamp program. Poor citizens were never supported to the level of the prosperous classes but their numbers as a political force kept them going for centuries on the public dole. Supplying “bread and circuses” became the path to popularity by subsequent Roman politicians. The elite undertook to keep the people entertained by sports and other spectacles, in stadiums and colosseums that Americans imitate today.

Although franchise reform was defeated, one political crisis after another kept opening loopholes for more resident aliens to become citizens. Around 100 BC, Marius reformed the army; eliminating the old militia in which all land-owning citizens were called each year, and putting in its place a standing army recruited from the impoverished proletariat. Soldiers were now long-term volunteers, supported by regular pay, and rewarded by allotment of lands when their 16-year tour was up. Such armies were much more expensive, and generals had to be capitalists in their own right to raise an army, and aggressive conquerors of new territory in order to pay for it. Marius’ nephew, Julius Caesar, would become the great master of this path to success — a liberal reformer who made an alliance between some of the richest capitalists and the urban poor.

In the meantime, full-scale war broke out over the question of the franchise. In 91 BC, another liberal reformer, Livius Drusus, ran on a program to give the Roman franchise to all Italians. He was murdered before the vote, giving rise to the Social War that went on from 91–88 BC. It was so called because the Latin word socii meant allies — the war of the long-suffering second-class non-citizens. This time the aliens had strong support, in the liberal faction of the Roman elite, and their new-style popular generals. The Social War dragged on for three years, fought in communities all over Italy. It ended in a compromise, since foreign provinces were taking the opportunity to revolt; peace terms offered Roman citizenship to all those who laid down their arms. Another bloody civil war went on down to 83 BC between the conservative general Sulla and the liberal Marius; the democrats were defeated but in the aftermath the franchise was conceded throughout Italy. Both sides had come to depend too much upon non-citizen communities for soldiers and support; and so many Romans from high ranking families were killed and expropriated in partisan purges that it brought considerable opportunities for upward mobility.

With Julius Caesar, the pattern was repeated on a larger scale, this time outside of Italy. Caesar recruited large numbers of Gauls, Spaniards and others into his legions; and during his conquests he bargained with friendly tribes by offering some form of citizenship. By the time of his assassination in 44 BC, Caesar was planning to erase the distinction between Italy and the foreign provinces. When peace was reestablished in the reign of Augustus Caesar in 27 BC, all this came to pass. Henceforward, Senators were appointed from all over the Empire, irrespective of origin. The highest offices were open to any citizen, without distinction of ethnicity or geography (of course there were other criteria, such as being rich, and above all a supporter of the ruling faction); emperors themselves came from all parts of Italy and the distant provinces.

Running Education

Monday, July 28th, 2014

Liberals are completely amnesiac about how they’ve been running education for a long, long time, Steve Sailer notes:

For instance, I went to a Catholic parochial school with nuns, and there was a little knuckle-rapping still going on in the mid-1960s. But by the time I got to St. Francis de Sales’ 7th grade in 1970, the younger teachers had staged a coup and organized a junior high school teaching collective that was more relevant. Most of my schooling in 1970-72, as far as I can remember, consisted of listening in class to album sides from Abbey Road, Deja Vu, Hair, and Jesus Christ Superstar for examples of symbols and metaphors, and sitting in a circle and rapping about how the deaths of Hendrix, Joplin, and Morison bummed us out.

And this was at a prim parochial school. I went to public Millikan Junior High for summer school those years and it looked like Dazed and Confused. Granted, St. Francis de Sales is just over Coldwater Canyon from the Sunset Strip, so we were probably a year or two out in the lead of the rest of the country, but your junior high school probably went through the same changes within a half decade.