Sep 8, 2014

Inflation and the Class War


Rick Santelli's unhinged rant against underwater mortgage relief in 2009 (see above) marked not just the birth of the Tea Party, but also the turn of the American monied class: from desperately accepting gigantic piles of free government money towards frantically mobilizing to prevent anyone but themselves from getting the same treatment. Through a tsunami of political donations, and a slew of lavishly funded think tanks and foundations, they demanded austerity in the teeth of the worst economic collapse in 80 years, especially cuts to social insurance. They destroyed any chance at mortgage relief for ordinary people. And perhaps least appreciated, they have constantly demanded hard money policy.

So over the last several years, one question has been persistently nagging one percenter analysts: is this behavior stupid or evil? That is to say, are the rich just slickered by very poor economic advice (like that dispensed by Santelli, who would have lost you a ton of money over the last five years), or are they deliberately acting as a class to choke the prospects of the 99 percent?

I believe it's a mix of both. But the key thing to remember for ordinary people is that the class war goes all the way down. More people than in generations understand that, to a very great degree, economic policy is a zero-sum struggle for power between the rich and everyone else. This very much includes our money policy – whether we will prioritize creating as many jobs as possible, or preserving the value of the dollar at all costs (hard money policy, in other words).

But let's step back a bit. Folks like like Paul Krugman and Brad DeLong have wondered whether the rich's love of hard money is a simple intellectual mistake, since a strong recovery (which has been hindered by inflationista/austerian paranoia) would mean more sales, more revenues, and more overall profits. It ought to be good for everyone.

Steve Randy Waldman disagrees. After a certain point, more money is useless in concrete terms, and wealth becomes more and more like insurance. Stronger growth may mean more aggregate production and profits, but if it looks likely upsets the current hierarchy of wealth, incumbents will resist it. Thus, the rich have always favored hard money, everywhere and always:
“Full employment” means ungrateful job receivers have the capacity to make demands that could blunt equity returns. And even if that doesn’t happen, even if the rich do get richer in aggregate, there will be winners and losers among them, each wealthy individual will face risks they otherwise need not have faced. Regression to the mean is a bitch. You have managed to put yourself in the 99.9th percentile, once. If you are forced to play again in anything close to a fair contest, the odds are stacked against your repeating the trick.
As Waldman notes, there is a long history here: the rich of 1896 mobilized more money as a fraction of the economy to defeat William Jennings Bryan's campaign against hard money than any presidential election before or since. (Roughly 4 times as much, in fact.) Krugman admits this makes a lot of sense, but is still drawn to the idea that the rich are misleading themselves, mainly because they routinely espouse totally bankrupt ideas.

This is an interesting topic to ponder for the future, given the outsize power the rich possess (I think you can explain the rapidly shifting nuttiness by noting the need for an unselfish cloak for naked self-interest), but the important thing for the non-wealthy is that class conflict is an inescapable part of money policy. People understand this when it comes to tax or health care policy, where recent Democratic Party policy like ObamaCare features substantial transfers from rich to poor (and most Republican policy goes the opposite direction).

But money is a much more slippery beast. It's one of those things that everyone has daily experience with, but gets stranger and stranger the more you think about it. Both from conversations with friends, memories of how I used to think, and the famous paper about the economics of a POW camp, average people have a vague idea that money is something that just happens in society, and rising prices are always bad. When it comes to inflation, people tend to believe that if prices rise 10 percent that means they'll only be able to afford 10 percent less stuff.

That's the inflation fallacy, and it serves the interest of the rich. If prices – all prices – rise 10 percent, that includes the price of labor (your wages) and the erosion of the purchasing power of a dollar will be exactly counterbalanced by an increase in wages. Money goes in circles in the economy: my spending is your income, and your spending is my income.

But that's why the way Waldman writes is so valuable – he translates these arguments in a way that makes sense on an intuitive human level. What is money, after all? Among other things, it is a claim on future production. But productive capacity is not cast in stone:
Human wealth is not like acorns for squirrels, stuff that can be buried in a tree and consumed over time. Most of the goods and services we require are ephemeral. They have to be produced and reproduced every day. When you save, you are asking other people to do the work of expanding the productive capacity of the economy so that when you eventually redeem your scrip for stuff, there is enough not only to pay all the future workers and investors actually producing, but also to cover your ratty old claims on wealth.
Pushing productive capacity forward through time is a difficult, tricky business. It's not just the daily grind against entropy: the production, repair and replacement of worn-out equipment, the hiring and training of new workers, the education of the young, and so on. It's also dealing with, on occasion, huge macro-scale catastrophes.

Suppose for example that we discovered that the financial system had been madly, unsustainably incentivizing the production of exurbs out in the desert – doing their vaunted allocation of capital right into the garbage disposal. Banks must eat huge losses and large parts of the real economy must be reorganized. Effectively, we find we're not as productive economically as we thought we were. We could deal with this problem by doing all we can to make sure everyone stays employed, which because of the need to reorganize sectors will likely result in scarcity and a one-time burst of inflation. Or we could allow giant levels of unemployment, so that workers will not have the money to bid for goods and services and the value of dollars will be preserved.

This isn't just a theory – the U.S. chose unemployment, while Israel and Australia chose inflation and largely avoided the Great Recession.

So when it comes to inflation, it's time for the non-wealthy to forget the 1970s (badly misinterpreted anyway) and recognize that this is a zero-sum political struggle. There is likely still quite a lot of slack in the economy, so production can probably be expanded without too much inflation, but for the non-wealthy, it's clearly worth the risk (vulnerable creditors could also be protected). Full employment is far more important than stable prices.

Aug 31, 2014

The Bizarre Bankshot Feminism of Tomb Raider

Tomb Raider is one of the weirdest games I have ever experienced. The story is hackneyed, predictable, and irritating. Despite having a female protagonist, it has serious issues with sexism. The violence, particularly that directed at Lara herself, is gratuitous and at times smacks of misogynist sadism. And yet, despite all that -- indeed, partly because of those problems, it is one of the most compelling games I've played. One which, for me at least, ended up in a surprisingly pro-woman place.

The game is so dichotomous it could have almost been made by two different companies. There is the Lara of the traditional videogame story moments -- the cutscenes, spoken dialogue, and quick time events. This Lara is largely helpless and repeatedly subject to shocking violence. A very early cutscene shows her being stabbed through the midriff with a filthy stick. The QTEs are infrequent and have fairly finicky timing, so I failed nearly every one repeatedly, thus having to watch Lara be brutally killed over and over as I learned the sequence.

Then there is the Lara of regular old gameplay, running and gunning across a big jungle island. This Lara is a fearsome, almost terrifying warrior who is as hard as a coffin nail. She casually slaughters hundreds of enemy men, with equal facility in hand-to-hand combat or a half-dozen ranged weapons. She is a world-class climber, routinely jumping across huge gaps and sticking on just a single climbing axe. That part is similar to the Uncharted series, but the whiny narrative insistence that this a Serious Game You Guys (though the “gritty” violence often came off as just silly) made me think about just how unbelievably strong Lara would have to be to pull off her climbing stunts. I would say she’d have to have the grip strength of Alex Honnold or Steph Davis, but in reality I doubt there’s a person alive, male or female, who could do half that stuff without dislocating both their shoulders. In short, in-game Lara is a Total Badass, and the play during these parts of the game was smooth and compelling.

But every once in awhile you get yanked out of that smooth experience to endure a hamfisted attempt at drama (basically a corny paint-by-numbers action plot) which usually involved Lara being stripped of all agency, either by being captured or sent on some errand. Compounding this effect was the camera and costume design, which were obviously designed to titillate a presumed straight male player. The camera is constantly leering at her breasts and ass -- the actual very first cutscene features a prolonged stare right down her shirt. Through the whole game she wears a scoop-neck tank top that is cut just exactly as low as the designers thought they could get away with, and as the story progresses her sprayed-on pants are ripped open in the inner thigh.

And the violence is just beyond ridiculous:



These two halves of the game were constantly grating against each other. Two sequences in particular stood out to me. The first is during an extended climb up to a cold mountain peak up to a radio tower. It’s snowing, and the wind is blowing hard, and at several points Lara is overtly shivering and remarking on how cold she is. On her way up Lara kills dozens of enemies, all wearing jackets or at least long-sleeve shirts. But while she can loot the ammunition and “salvage” (for upgrades) off their corpses, she can’t take any of their clothes, obviously because then the camera wouldn’t be able to zoom in on her breasts whenever there’s the slightest excuse for it.

The second sequence was a short cutscene. After fighting her way past yet more dozens of hapless guards, Lara finds her objective: a friend of hers (another woman, natch) has been captured. She is well-equipped by this point, but instead of busting out her shotgun or automatic rifle, she runs out into the open, and tries to snipe the cultist leader with her bow. It's an easy shot that Lara has by now made a hundred times -- the leader is just standing there in plain view -- but she misses, alerting the troops, and then misses again as the goons run up, then proceed to beat the shit out of her.

This contrast between the intimidating, no-bullshit competence of in-game Lara, and the obnoxious, helpless cutscene Lara, created an oddly feminist experience, if you can believe it. Over and over and over, the message of the game, whether intentional or not, was: see? This is what being a strong woman is like. In-game Lara would have slaughtered a dozen deer, tanned her own leather out of a solution of brains, and made herself a bulletproof winter parka, but she can’t because Cutscene Lara has to have her breasts on display at all times. In-game Lara would have made that above-mentioned shot, whipped out her shotgun, and blasted the oncoming goons into red mist without even blinking, but she can't because the story writers couldn't be bothered to come up with a more plausible transition. In-game Lara can hit a nickel with a pistol at 100 yards, Cutscene Lara yells “SAM?!??” through her radio when her friend is obviously being captured.

At all times, the needs of Lara the female character are set below the needs of a stupid story operating in a sexist framework.

And yet, it was a pretty compelling game! Constantly being whipsawed between these two perspectives was quite interesting if nothing else, and I ended up noticing all kinds of sexist garbage that I probably would have missed if the story had been more absorbing (like the ripped pants, I mean come on). I wouldn't say it's great, because this dichotomy is so distracting, and the story is lousy, but it did hold my attention. Maybe next time they can write a story for the real Lara?

Jul 17, 2014

Neal Stephenson on the Miracle of the Human Body

"The room contains a few dozen living human bodies, each one a big sack of guts and fluids so highly compressed that it will squirt for a few yards when pierced. Each one is built around an armature of 206 bones connected to each other by notoriously fault-prone joints that are given to obnoxious creaking, grinding, and popping noises when they are in other than pristine condition. This structure is draped with throbbing steak, inflated with clenching air sacks, and pierced by a Gordian sewer filled with burbling acid and compressed gas and asquirt with vile enzymes and solvents produced by the many dark, gamy nuggets of genetically programmed meat strung along its length. Slugs of dissolving food are forced down this sloppy labyrinth by serialized convulsions, decaying into gas, liquid, and solid matter which must all be regularly vented to the outside world lest the owner go toxic and drop dead. Spherical, gel-packed cameras swivel in mucus-greased ball joints. Infinite phalanxes of cilia beat back invading particles, encapsulate them in goo for later disposal. In each body a centrally located muscle flails away at an eternal, circulating torrent of pressurized gravy. And yet, despite all of this, not one of these bodies makes a single sound at any time during the sultan’s speech. It is a marvel that can only be explained by the power of brain over body, and, in turn, by the power of cultural conditioning over the brain." --Cryptonomicon

Jun 23, 2014

Jun 7, 2014

John Rawls and Race

I stumbled across this and thought it was wildly tendentious. Was Rawls really utterly unaware of the basic facts of American history?



But then I watched this, and it has a much more extensive, much more convincing discussion of Rawls, traditional political liberalism, and race; and trying to adapt the Rawlsian framework to include racial justice. Very, very good:



I reckon Mills just wanted to include that Chris Rock bit.

Jun 4, 2014

The Great Conservative Berg-versal

Matt Binder performs some Twitter excavation:


May 27, 2014

The War Crimes of the Bush Regime

Damon Linker: "No, Condoleeza Rice is not a war criminal."
They mean that leading members of the Bush administration are war criminals in the precise legal sense that they violated the imposing body of rules and regulations that have grown out of the post–World War II Nuremberg Trials and Geneva Conventions. These rules are known as "international law."
There's a reason I placed the term in quote marks — because I think it's inaccurate to describe these rules and regulations as laws. They are, strictly speaking, bilateral and multilateral treaties between and among governments.
Laws, by contrast, are written, enacted, and executed by governments, and they apply exclusively to those residing within territorially defined political communities (be they city-states, nations, or empires). Citizens of liberal democracies hold, moreover, that laws gain legitimacy — and become binding — only with the consent of the governed. And that standard is (tacitly) met only when the laws have been crafted by the people's democratically elected representatives.
"International law" fulfills none of these requirements.
The Constitution of the United States:
This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.
The UN Convention Against Torture, passed by a two-thirds majority in the Senate and signed by President Reagan:
Article 2 
1. Each State Party shall take effective legislative, administrative, judicial or other measures to prevent acts of torture in any territory under its jurisdiction. 
2. No exceptional circumstances whatsoever, whether a state of war or a threat of war, internal political instability or any other public emergency, may be invoked as a justification of torture. 
3. An order from a superior officer or a public authority may not be invoked as a justification of torture.