When Centralized Institutions Fail, Is Anarchy an Answer?


Last week I raised the topic of institutional failure: Why is institutional trust and trustworthiness failing more-or-less across the board? Corporations, political parties, the various layers and branches of government, churches, academia, the banking system, the media — none provides a solid base to stand on while we reform the others.

Two leaps. Then I made a leap you might not agree with: Even though each institution has its own failure story, I decided to look for some common cause, which I called a UFT (Unified Fuck-up Theory). I chose a tongue-in-cheek label because I realize I’m getting uncomfortably close to conspiracy-theory territory. (In Valis, Philip Dick wrote, “It certainly constitutes bad news if the people who agree with you are buggier than batshit.”) But the alternative is big-coincidence territory, and I’m not comfortable there either.

I followed that leap with another, which I’ve since come to call the Agatha Christie Hypothesis: If the clues don’t add up, it means that the culprit never made it onto your suspect list. So the common cause is likely to be something we instinctively don’t question.

Chris Hayes went down that path in Twilight of the Elites and pointed his finger at meritocracy. The certainly satisfies the ACH: Literally nobody had been saying “Our problem is that talented, hard-working people get ahead.”

As I laid out in more detail last week, Hayes argues that meritocracy justifies a level of inequality that has created a new ruling class, i.e., the elite have enough power to game the system that there is no longer anything like the level playing field meritocratic theory assumes. As a result, our institutions are run by an entrenched, hyper-competitive, self-serving elite that feels entitled to whatever it can grab. We have re-created the noblesse without the oblige.

In The Leaderless Revolution, former British diplomat Carne Ross adds another unexpected culprit to the suspect list: representative democracy.

Sheep and Shepherds. The basic idea of representative democracy is that a world of sheep and shepherds is fine, as long as sheep get to elect their shepherds. Presumably, the sheep will choose good shepherds, who will stay good because the sheep could replace them.

Ross criticizes this model from both sides: First, the options offered to the people are too limited and too easily manipulated by those with money and power. My favorite expression of this situation comes from the Cake song “Comfort Eagle”

Some people drink Pepsi, some people drink Coke.
The wacky morning DJ says democracy’s a joke. 

More prosaically, Benjamin Barber wrote:

We are seduced into thinking that the right to choose from a menu is the essence of liberty, [but] the powerful are those who set the agenda, not those who choose from the alternatives it offers.

In November, for example, the American people will elect either Romney or Obama. How many important issues does that choice take off the table?

Second, the job of “good shepherd” is impossible in such a complex, diverse, inter-connected world. Even with the best intentions, no one can “represent” a nation like the United States or the United Kingdom. The very attempt (as Ross knows from personal experience) leads you to adopt grossly oversimplified worldviews that create more problems than they solve.

Representing the UK at the UN. The stories from Ross’ diplomatic career are worthwhile whether you end up agreeing with his conclusions or not.

The British Foreign Office is an elite Chris Hayes would recognize. A hyper-competitive process selects Ross and a few others out of thousands of applicants.

We were a chosen elite, given to expect that in due course we would become ambassadors and undersecretaries, the most senior exponents of our country’s wishes. I was elated to join this exclusive club and happy to undergo the many compromises membership in this group entailed.

Then the recruits are indoctrinated into the groupthink of the Foreign Office, which affirms the diplomats’ superiority: Only they know the classified information. Only they have unfettered access to the real experts — each other.

Eventually, Ross becomes head of the Middle East section of the British mission to the UN, where he and his American allies design and maintain the trade sanctions against Saddam Hussein’s Iraq — sanctions that were not only based on false assumptions about Iraq’s WMDs, but whose burden fell mainly on the Iraqi poor. Ross now accepts demographers’ calculations that the sanctions caused an “excess mortality rate” of half a million Iraqi children.

In other words, half a million children died. Though Saddam Hussein doubtless had a hand too, I cannot avoid my own responsibility. This was my work; this was what I did.

In what way, Ross now wonders, did he “represent” the people of the United Kingdom? Given the information and responsibility he had, how many of Ross’ sheep would have let hundreds of thousands of Iraqi children die in exchange for a small theoretical increase in their own safety? Might they instead have shown some compassion and courage? And if ordinary citizens of both countries had met in the same room, might they have come up with completely different options?

Rather than a series of gates through which information and power flow, representative democracy has become a series of walls: The people are cut off from their diplomats, and the diplomats in turn are cut off from the foreign peoples their actions affect.

Similar stories could be told in every country, about every aspect of government policy.

Renouncing the pact. So Ross is attacking government from a different side than conservative libertarians do. Libertarian rhetoric focuses on the tyranny of governments interfering with sovereign individuals, and minimizes any collective or social responsibility. “Society” is just a myth that justifies the few ruling the many.

Ross is saying almost the exact opposite: Not only do we have collective responsibilities to do things like take care of the planet, help each other, establish justice, and live together in peace, but those responsibilities are too important to hand off to leaders. He wants us to renounce what he calls “the pact”:

We vote, they act; we get on with our lives, they protect. … For most of us, politics is a spectator sport.

He cites the 2008 Obama campaign. Obama called for and got unprecedented participation from individual citizens. But

The political end of his campaign was not change itself, but for him to be elected to deliver change — a subtle but crucial distinction, and the disjunction at the heart of representative democracy.

Grey anarchy. Ross uses the word anarchy in a positive sense, but he means something subtle by it. Usually we talk about anarchy in a black-or-white way. We have a government or we don’t; anarchy is achieved by overthrowing government and not replacing it.

Ross’ anarchy has more grey in it. Government isn’t evil, just hopelessly inadequate. We need to figure out how to work around government — rather than through it — in order to fulfill our social responsibilities.

If government cannot provide for the stability, safety and just arbitration of our common affairs, who can? The answer is both radical and discomforting. For there is only one alternative if government cannot successfully provide: We must do so ourselves. Self-organized government is one term; another, rather more loaded term, is anarchism.

His model is more the everybody-pitch-in model of Wikipedia than the every-man-for-himself model of conservative libertarianism. Rather than electing the next savior, activists should focus on creating new arenas of interaction and trust where creative self-organization becomes possible.

The goal is to make the leaders become the followers: Rather than change society through politics, directly create social change that the politicians will have to react to.

Methods, not programs. Predictably, Ross’ prescriptions are on the vague side, and are more about methods than programs. (If he said, “Pass my program” he’d be back in the representative democracy model, offering himself as a leader.) He ends with nine principles for action, but unfortunately they take more space to unpack than I have. So I’ll have to do my own summary.

The ideal anarchic action, from Ross’ point of view, is something that will start a wave: It tackles the problem in some small but direct way, other people will see it, and they will be inspired to imitate. It is nonviolent and builds new trustworthy relationships. It will achieve something even if it doesn’t totally catch on. It focuses on those who are suffering most, and asks what they want rather than imposing a solution on them.

Gandhi’s salt march, Rosa Parks not giving up her seat — these are both cited as good examples.

Or maybe we could look at Ross’ current project, which he describes in this interview on the Colbert Report: He’s working an Occupy Wall Street bank.

July 16, 2012 – 12:42 pm Categories: Articles, The Sifted Bookshelf | Comments (2)

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What Shaving Taught Me About Capitalism

A couple months ago, I ran into an article on TechDirt that linked to another guy’s post on his personal blog, both making the same ridiculous point: Shaving technology hasn’t really improved since World War II.

Anybody who watches sports in real time (when you can’t fast-forward through the commercials) knows this is crazy. For decades, shaving has had a “revolution” every two or three years: disposables, cartridges, comfort strips, double-blade, triple-blade, and now even 5-blade cartridges. Each revolution makes shaving a little more expensive, but it achieves the perfect comfort and safety that the previous revolution fell short of.

Or so the ads say.

But these guys on the internet were saying that all the revolutions were just marketing nonsense, and that I (and just about every other male on the planet) had been taken in by it. Shaving itself hadn’t gotten any safer, easier, or more comfortable since the last few bugs were worked out of the double-edged safety razor, a technology that is more than a century old.

All these “improvements”, they claimed, had only two purposes:

  • to create a patentable technology that would protect the manufacturer from generic competition for another 20 years or so.
  • to provide a marketing gimmick that would make men fork over big bucks for a product no better than one they could buy cheaply.

That couldn’t be right. Could it?

Reclaiming the way of my ancestors. It’s actually not that simple to find out. My local supermarkets and drug stores sell double-edged blades if you look hard enough for them — they get one hook in the whole shaving aisle — but the razors they fit into are nowhere. No worries, though, that’s what the internet is for: I got a perfectly functional razor (in the old butterfly style my Dad used) for about $20. That lone hook in my supermarket carries 5-blade packs for $2. Above it, rows of 8-packs of Gillette Fusion cartridges go for $32.

Do the math: 40 cents apiece vs. $4 apiece. Even for somebody like me (who goes bearded in the cold half of the year) that could add up.

But what about the experience and the quality of shave? You have to hold the handle at a slightly different angle (because the double-edged blades sit perpendicular to the handle rather than being angled like the cartridges), and that takes a day or two to get used to. After that, in my opinion, the “improved” 21st-century razor is no better and might even be worse.

Connoisseur shaving. Once you start browsing through shaving web sites, you quickly discover the other side of the market: straight-razor shaving, like the old-fashioned barbers did before King Gillette (his real name, apparently) invented his double-edged blades. (BTW, it turns out this great American entrepreneur was a utopian Socialist.)

Today, straight-razor shaving is a way for a man to establish his connoisseur identity, and it carries a comparable price tag. A high-class straight razor can set you back hundreds. Then you need a leather strop, and the perfect brush and bowl to mix your special shaving soap, and on and on.

Upper-crust malls have a chain of shops called The Art of Shaving, many of which include a barber chair where a straight-razor professional can demonstrate proper technique.

Does it make a difference? I got the cheap cousin of the classic straight razor — a $19 arm-and-handle that holds half of a double-edged blade. Straight-razor shaving turns out to be like driving a manual transmission or baking a cake from scratch. It takes some learning, there’s a certain satisfaction to mastering it, and even if you never do it again, you’ll have a deeper appreciation of what’s really going on when you shave.

Here’s the deeper appreciation I got: All blade shaving comes down to covering your face with something slick, and then dragging something sharp across it. You can improve by making the slick stuff slicker or the sharp thing sharper, but pretty soon you’ve gone as far as you can go. Beyond that, it’s all marketing.

Profit margins. So let’s review. Shaving has basically been a solved problem for at least half a century. By the 1970s the patents on those solutions had expired, and nothing of importance has been invented since. In a sensible world, all men would know this and the factories would focus on delivering cheap high-quality double-edged razor blades.

That didn’t happen because it wouldn’t have made anybody rich. Since a standardized, patent-expired product like the double-edged razor can be made cheaply by anybody, the profit margin is too small to buy Super Bowl ads or pay stupendous CEO salaries.

So instead, the market has gone two ways. The mass market has kept research labs busy churning out phony “improvements” that generate market-protecting patents and give advertisers something to work with. And vast amounts of money have been spent persuading men (successfully!) that there’s something new worth paying up for and something primitive about the double-edged safety razor.

For men who have caught on to that game, a connoisseur market sells expensive shaving paraphernalia to bolster an overclass identity. So whether you’re a mass-market Gillette-Fusion-type guy or a connoisseur wielding a buffalo-horn-handle Damascus-steel-blade straight razor, you support a market with high profit margins.

Computers, razors, and public schools. This isn’t a personal-care blog, so I didn’t tell you any of that because I think you care about shaving. Instead, I believe there’s a lesson here about capitalism and politics.

Whenever we have a public discussion about the virtues of the free market, we always end up talking about computers. Computers keep getting better and lighter and faster and cheaper because that’s what the market does; it forces everybody to improve or die.

So we’re always promised that if we turn the magic of the free market loose in some new area — if we get rid of public schools, say, and let the market educate our kids, or if we stop regulating healthcare and let hospitals, doctors, and insurance companies compete freely — we’ll see the same incredible progress we’ve seen in computers. Everything will get better and cheaper in ways no one can imagine now.

But how do we know that the education market or the healthcare market won’t turn out to be like shaving? What if, instead of low prices and spectacular improvements, we get high prices funding marketing campaigns that obscure and denigrate the low-profit-margin solutions that already exist and actually make sense?

Realistically, it could go either way. Neither the computer market nor the shaving market is an invention of some political propagandist. Both exist in the same economy.

Capitalism is double-edged that way. Sometimes the market inspires scientists and engineers to build a better mousetrap. But sometimes it’s the advertisers who turn out to be slicker and sharper than the rest of us.

July 16, 2012 – 10:20 am Categories: Articles | Comments (11)

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Believe in America, Mitt

Now available on t-shirts. Click the image.

When Mitt Romney wrapped up the Republican nomination in April, I framed the next phase of the campaign in terms of four narratives: pro/anti-Obama and pro/anti-Romney. The anti-Romney narrative was:

You should vote against Romney because he’s not on your side. His policies favor the rich because he’s rich, he’s always been rich, and the rich are the only people he understands or cares about.

In the last few weeks we’ve seen Obama’s people establishing that narrative and Romney’s people floundering to counter it. The threads of that story are Romney killing American jobs while he was at Bain Capital and Romney maneuvering around taxes by running his money through Bermuda, the Cayman Islands, and Switzerland.

When this stuff came up in the Republican primaries, Romney toughed it out by saying his critics were jealous of his success, he did nothing illegal, and he wasn’t going to talk about it.

Those answers worked then for two reasons:

But Romney should fire whoever told him the same answers would work now. The Republican establishment may have whipped Gingrich and Perry into line, but they can’t make Obama back off. And general-election swing voters do see tax evasion as a moral issue. It’s not enough for Romney’s high-priced accountants to follow the letter of the law. When the rich wriggle out of taxes by using special dodges not available to working people, that’s not clever, it’s sleezy.

Plus, it undermines the pro-Romney narrative, which I phrased like this:

This country is going the wrong way and Romney is a smart executive who knows how to turn things around.

Sure, Romney is smart. But is he Steven Jobs smart or Bernie Madoff smart? Swiss bank accounts, Bermuda shell corporations, deals where Romney walks away with all the money and everybody else gets screwed … what does that sound like?

Once you get past first impressions, the argument over Bain turns technical, which is never good for a politician trying to dispel a bad odor. (That’s what Lee Atwater meant when he said, “If you’re explaining, you’re losing” — a line Romney misquoted and apparently doesn’t understand.) Romney’s defense against the job-exporter charge is that Bain outsourced to Mexico and China only after Romney left in 1999 to run the Salt Lake City Olympics. That answer temporarily convinced New York Magazine’s Jonathan Chait, who, in a remarkably balanced analysis, concluded that Obama’s attacks were false … until the next shoe dropped and he had to write an update.

The next shoe was the Boston Globe uncovering filings with the SEC in which Bain listed Romney as CEO up to 2002 and said he made a six-figure salary for what he now claims was a no-show job. Also, when Massachusetts Democrats challenged his residency prior to his 2002 run for governor (partly because Romney had been avoiding state taxes by listing his Utah home as his primary residence), Mitt claimed he was merely “on leave” from Boston-based Bain, making Massachusetts his real home.

So where Romney lives, who he works for, and the location of his money all vary depending on who’s asking and why.

Shifty. Sleezy. And in retrospect, maybe not as clever as he thought.

On Friday, Romney broke out of his bubble and let himself be interviewed by every major news network other than MSNBC. Unfortunately for him, he doesn’t understand the playbook for such situations. Unlike, say, Barack Obama trying to settle the Jeremiah Wright controversy or the Clintons responding to Gennifer Flowers’ charges, Romney offered no deeper insight into himself and no broader frame for the story as a whole. Instead, he just put his own face behind the unconvincing denials his people had already offered.

Two media responses to the Romney interview blitz sum up how ineffective it was. Rachel Maddow (of the spurned MSNBC) laughed at the situation:

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And Forbes’ T. J. Walker captured how little Romney had settled in 35 Questions Mitt Romney Must Answer About Bain Capital Before The Issue Can Go Away.

Meanwhile, there’s some evidence that the Bain story is moving the polls in swing states, where Obama is running ads like this one.

But at this stage, the main thing is the narrative, not the polls. Come November, both Romney and Obama will need a closing argument to convince those last few undecideds. That argument will have to build on the stories being established now. “I’m a smart executive” is not going to do the job.

July 16, 2012 – 9:04 am Categories: Articles | Comments (2)

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The Monday Morning Teaser

This week’s Sift has three articles, so there won’t be as many short notes as usual. I had planned two:

  • a discussion of Carne Ross’ new book The Leaderless Revolution, which pairs nicely with what I talked about last week, Chris Hayes’ Twilight of the Elites. Both books are looking at the broad failure of our institutions and finding its roots in the dark side of something we believe in deeply. Hayes targets meritocracy, and Ross attacks the whole notion of representative government. Ross uses his experiences as a British diplomat to argue that the world has become too complicated to turn our responsibilities as citizens over to leaders. He argues instead for a more anarchic, more directly participatory way of addressing our problems. (Yes, Ross is an Occupy Wall Street guy.)
  • a lighter piece that I think makes an important point: What Shaving Taught Me About Capitalism. Discussions about the free market always end up focused on computers, where the market has stimulated better performance for less money. For some reason they never focus on shaving, where a series of phony “revolutions” in technology have justified higher prices for no improvement in performance. In the course of my research, I end up reclaiming the inexpensive tool of my ancestors, the double-edged safety razor. (And since I know someone is going to notice: The bearded picture above is how I look in the winter. In the summer I’m clean-shaven.)

But this week’s news-network buzz about Mitt Romney’s finances and business career was such a perfect illustration of what I was talking about last April (in The Narratives of November) that I just had to comment. So there’s a third article: Believe in America, Mitt.

The shaving article should go up in an hour or so, and I expect the complete Sift to be up roughly noonish on the East Coast.

July 16, 2012 – 7:45 am Categories: Morning tease | Comments (1)

Roll Over, Mr. Madison

While our legislative branch, the foundational pillar of our republic, is the least trusted institution in the country, our standing army and police forces are the most. Increasingly, we trust the men with the guns, not the men in suits. The sound you hear is the founders rolling over in their graves.

Chris Hayes, Twilight of the Elites (2012)

This week everybody was talking about … the heat

Records were set all over the country. But unlike the DC snowstorm of 2010, it had nothing to do with global warming.

… and the Higgs boson

I love discussions where nobody knows what they’re talking about, including me. I caught up a little by consulting the Instant Egghead at Scientific American.

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You can also get some  general background on CERN’s Large Hadron Collider from this 2008 rap by Alpinekat (a.k.a. Katherine McAlpine).

… and the political fallout from the ObamaCare decision

Some argued that the ruling was good for Romney, because it energizes the conservative base. But I agree more with Alec MacGillis:

Judging this the better outcome for Romney means seriously understating just how brutal the law’s rejection would have been for Obama. It would have allowed Romney to argue—to crow to the skies, surely—that Obama’s entire first term had been a giant zero.

From Day 1, the right-wing drumbeat against Obama has been that his presidency is illegitimate: He’s not really American, he doesn’t understand America, he doesn’t follow the Constitution, and so on. John Roberts saying ObamaCare is constitutional makes that look like the crank theory it has always been.

Of course, you fix a crank theory with another crank theory, so Roberts’ betrayal sparked wild conspiracy theories on the Right.

My theory: Roberts doesn’t want to go down in history as the Chief Justice who broke the Supreme Court. As much as people have always complained about the Court, it used to be seen as above partisan politics. But controversial decisions like Bush/Gore and Citizens United have put that image in serious jeopardy. If a party-line vote threw out the biggest Democratic legislative accomplishment of the last half century, with a majority opinion based on a new legal distinction invented precisely for that purpose, the Court might not recover.

The Court doesn’t control any money or soldiers, so it needs its reputation. If they’re just nine over-the-hill political hacks who can’t be fired, then why shouldn’t presidents defy them? Why wouldn’t some future President Nixon just burn the tapes?

[I covered the ruling itself last week. Harvard’s Einer Elhauge has an enlightening refutation of Roberts’ reading of the Commerce Clause.]

Meanwhile, the Partisans made fun of people who now want to leave the country to avoid socialized medicine.

… but I decided to write about institutional failure and Leviticus

  • In Search of a Universal F***-Up Theory. It’s not hard to come up with specific theories explaining why our political institutions are dysfunctional, our religious institutions corrupt, our economic institutions rapacious, our media institutions untrustworthy, and so on. But why is all this failure happening at once? (And no, I don’t think it’s the Internet, the Koch Brothers, or the end times.)
  • The Economics of Leviticus. You can’t have a culture-war conversation without somebody quoting Leviticus. What if you couldn’t have an economic conversation without somebody quoting Leviticus? That would change a lot of things, right down to our basic understanding of property.

Meanwhile, you might also find this interesting

Verizon has opened the next front in the corporate-personhood battle: It says that the FCC’s net neutrality rules are unconstitutional because

Broadband networks are the modern-day microphone by which their owners [e.g. Verizon] engage in First Amendment speech

Weird. I thought I was engaging in First Amendment speech, and that Verizon’s broadband network was just carrying that speech to some of my readers. But no, Verizon is speaking. Can you hear them now?

The Obama campaign is making hay out of Romney’s offshore accounts and his refusal to release tax returns before 2010.

Here’s why Romney might carry Pennsylvania: Under the new voter-ID law passed by the Republican legislature and signed by the Republican governor, 9.2% of registered voters don’t have the appropriate IDs yet, including 18% of voters in the Democratic stronghold of Philadelphia. That’s more voters than Obama’s margin in 2008.

One of the mysteries of polling this year is why Romney is sometimes ahead in the Gallup tracking poll, while Obama is consistently ahead in polls of swing states and close in states Romney has to carry, like North Carolina. It seems unimaginable that Romney could win the national popular vote and not carry North Carolina handily.

Possible answer: Gallup’s methodology systematically undercounts non-whites.

Meanwhile, polling wonks will love Nate Silver’s attempt to model the influence of the economy on presidential elections.

A good, practical talk about teaching:

The Myth of the Super Teacher from EdWriters on Vimeo.

I was going to write my own decline-of-Justice-Scalia article, but Salon’s Paul Campos did it for me. Back in the day, Scalia was the kind of conservative a liberal could admire. He viewed the world through a different lens, but he challenged us to raise our game. I always learned something from reading a Scalia opinion. Now, though, he just repeats what he’s heard on Fox News. It’s embarrassing.

Anybody who goes to a big 4th of July celebration must wonder: What if all the fireworks went off at once? Well, in San Diego they found out.

I spent Wednesday evening in Lowell, where the fireworks were backlit by lightning over Boston. But if I had been in Alabama Friday I could have attended a different night-time ritual: the “sacred Christian cross lighting ceremony” that culminated a conference sponsored by the white supremacist Christian Identity Ministries. Apparently this was not a hoax.

After waffling for a few days, Mitt Romney now has his position on whether an individual healthcare mandate is a tax: It’s a tax when Obama does it nationally, but it wasn’t a tax when he did it in Massachusetts. In his own words:

The Supreme Court is the highest court in the nation, and it said that it’s a tax, so it’s a tax. … The chief justice in his opinion made it very clear that at the state level, states have the power to put in place mandates. And as a result, Massachusetts’s mandate was a mandate, was a penalty, was described that way by the legislature and by me, and so it stays as it was.

Salon checks in on the Elizabeth Warren campaign. To me that race comes down to: Do you want your senator to be owned by the bankers, or not?

Here’s the difference between public and private: Public employees have a mission that goes beyond profit. Case in point: A private Florida lifeguard company fired a lifeguard for saving a life outside company territory.

Republicans want to replace ObamaCare with “patient-centered health care”. What is patient-centered health care? A phrase that tests well in focus groups. It does not refer to any specific proposal.

A legislator who voted for Louisiana’s radical new school-voucher program is now opposed to it. What changed? She suddenly realized that a “religious school” doesn’t have to be Christian. She supports freedom of religion, just not for Muslims.

Factoid discovered while researching something else entirely: The word boycott comes from Captain Charles Boycott, who was the agent of an absentee landlord in Ireland in 1880. To protest Boycott’s eviction of tenant farmers, the local community ostracized him, and workers refused to harvest the land he managed.

Come November, women shouldn’t forget what conservatives stand for.

But let’s end on a moment of cute. Pandas on a slide are like 4-year-olds who are too round and fluffy to get hurt.

July 9, 2012 – 1:05 pm Categories: Short Notes, Weekly summaries | Post a comment

In Search of a Unified F***-Up Theory

The biggest mystery of recent years is: Why are all our institutions failing at the same time? Think about it:

  • We just had a banking crisis that required trillions of dollars of bailouts and interest-free loans to the very people who caused it and profited from it. No one went to jail, in spite of massive evidence of criminality. More-or-less nothing has been done to prevent the same thing happening again.
  • Our election campaigns have become open bidding wars. As a result, Congress is largely unresponsive to the desires of anybody who’s not rich, and the number of people who rate the “honesty and ethical standards” of congressmen as high or very high is an anemic 7% — the same rating lobbyists get.
  • The public distrusts scientists. Among scientists who study climate, 97% believe in man-made global warming. But only about half of the public does, and that’s a recovery to 2009 levels after a considerable dip.
  • The Catholic Church has been rocked by its pedophilia scandal. And the worst of it is this: When bishops found out, they uniformly protected the guilty priests rather than the innocent children. That part of the scandal goes all the way to the Pope, and there’s been no house-cleaning of implicated bishops.
  • Public expectations of presidential candidates have plummeted. In 2000, Al Gore was tagged with being a “serial exaggerator” after saying a few mostly true things. This year, much of Mitt Romney’s stump speech consists of publicly debunked lies, and it’s not an issue. Voters shrug and say that all politicians lie.
  • The Supreme Court has become partisan. People have always complained that the Court’s legal philosophy was too liberal or too conservative. But only since John Roberts and Sam Alito replaced David Souter and Sandra Day O’Connor have major cases routinely been decided on 5-4 party-line votes. Today, if the president who appointed you was Republican or Democrat, that’s the side you take. The shock of Roberts’ ObamaCare decision wasn’t his legal reasoning, it’s that he crossed party lines.
  • In discussions about baseball’s Hall of Fame, the main topic isn’t how good players were, it’s whether they cheated or not. It’s very possible that the biggest stars of the 1990s — Barry Bonds, Roger Clemens, Alex Rodriguez, Mark McGwire, Sammy Sosa — won’t be in the Hall.
  • Both Presidents Bush and Obama embraced the doctrine that the president can rain death on countries we are not at war with. If Americans get killed in the process, too bad. American citizens might even be the target.
  • Trust in journalism has collapsed. Again and again, the press has been the watch-dog that didn’t bark: Iraq’s non-existent WMDs, the housing bubble, and so on. Plus, they’ve increasingly practiced he-said/she-said journalism that punts the question of what is true. Newspapers are closing, reporters are being laid off — and yet, at the top, the marquee journalists remain the same no matter how many stories they screw up. The marquee pundits keep their jobs no matter how often they are proven wrong.

It goes on and on. All eras experience some institutional failure, but usually when one institution fails, you can take refuge in another: When Al Capone had city government in his pocket, the feds took him down. When the political process denied justice to blacks, the courts provided it. When Nixon’s White House was corrupt, Congress, the judiciary, and the press performed well.

What’s bizarre and unsettling about our era is that there seems to be nowhere to turn. Why is that? What’s making all our institutions suspect at the same time?

Devil theories. If you’re a certain breed of conservative Christian, what’s going on is obvious: The Devil and his minions are stepping up their malignant activities in preparation for the End of the World. And various secular subcultures have their own devil theories: the Koch Brothers, the worldwide socialist conspiracy, and so on.

While I’m no fan of the Kochs, all these one-big-conspiracy theories seem nutty to me. (I’ll bet lots of eras had evil billionaires.) But I do have to give them this: A devil theory is an answer on the scale of the problem. 

Conspiracy theorists respond to our attempts to be rational with: “What? You think this is all a coincidence?”

They’ve got a point. This situation begs for a UFT (Unified Failure Theory, or, as I sometimes call it, Unified Fuck-Up Theory), something that pulls it all together. But could we get a non-crazy one?

The meritocracy did it. If you read classic mysteries, you’ve seen this situation before: The clues link up here and there, but don’t make sense when you put them all together. Usually that means that the murderer is somebody who is off your radar completely, either because you’re trained not to see them (the butler) or you trust them implicitly (the vicar or the victim’s loyal-but-mousy sister).

That’s the approach Chris Hayes takes in Twilight of the Elites. Whatever ties these failures together must be something we’re incapable of doubting. Otherwise we’d have seen the connection by now.

What is it that all our smartest people believe in implicitly? The meritocracy. The principle that the most talented, hardest working people should rise to the top.

And while belief in the meritocracy is self-serving for those who do make it to the top, it’s more than that: All the social progress of the last half-century — civil rights, women’s rights, gay rights — justified itself in meritocratic terms: If you are good at what you do, you should rise, even if you don’t look like the people currently on top.

But what if elite failure — bankers who can’t bank, representatives who can’t represent, immoral moral leaders, and so on — is the dark side of the meritocracy?

What is meritocracy? Hayes says meritocracy depends on two principles: inequality and mobility. There is a top to rise to, and nothing but your own limitations can stop you from rising.

The problem is that the combination is unstable: When inequality passes a certain point, the people on top become powerful enough to screw up mobility. Eventually, no matter where they came from originally, the meritocratic elite comes to look on itself as a class and pursue its own interests.

The first example Hayes gives is the best: his alma mater, Hunter College High School in Manhattan.

Entrance to Hunter rests on a single “objective” measure: one three-hour test. If you clear the bar, you’re in; if not, you’re out. There are no legacy admissions, and there are no strings to pull for the well connected.

Hunter’s racial/ethnic composition never matched New York City’s, but the gap has widened in recent years. The entering class was 18% black/Hispanic in 1995, but just 4% in 2009.

Why? The test-prep industry. If you’re almost Hunter quality but have money, you can train to pass the test. If you’re just barely Hunter quality and you don’t have money, you’ll get aced out.

New York’s wealthy elite has figured out how to game the system for its children. And Hunter’s selection process has not kept up because … why would it? People powerful enough to make the system ungameable are precisely the ones who want to game the system.

Entitlement. What happens when a meritocracy gets corrupted like this? The appearance of rigorous competition remains, leaving the elite with an undeserved sense of entitlement: We are the ones who passed the test, so we deserve the cookies.

Such a ruling class would have all the competitive ferocity inculcated by the ceaseless jockeying within the institutions that produce meritocratic elites, but face no actual sanctions for failing at their duties or succumbing to the temptations of corruption. It would reflexively protect its worst members, it would operate with a wide gulf between performance and reward, and would be shot through with corruption, rule-breaking, and self-dealing as those on top pursued the outsize rewards promised for superstars.

But such a ruling class would also not be as smart as it thinks it is. It might, for example, think it has come up with a totally new and foolproof way to handle financial risk — and screw it up.

It would also see success as its own justification, an attitude that Hayes connects to Enron and the mortgage bubble. The people making the most money must be the smartest, and anyone who tries to tear them down is just jealous.

Co-opting Obama. Newcomers to the ruling class really did have to jump some hurdles, and as a result they have undue faith in the class they have entered into. President Obama, for example, cannot shake his faith in the experts. Surely the bankers must be the right people to fix the banking system. The businessmen must be the right people to revitalize business. If they weren’t the smartest people in the room, they wouldn’t have made it to the top, right?

Fractal inequality. This is my favorite phrase from the book. No matter how high you rise — the 1%, the 0.1%, the 0.001% — there always seems to be a higher level where the real action is. Again, Hayes uses his own experience well: When he finally got an invitation to the Davos meetings, it seemed like evidence that he had really made it. But once there

you realize that in the context of Davos attendees, you are a member of the unwashed masses

And the people you look up at are the unwashed masses of an even higher level.

As a result of this fractal inequality, everybody is constantly struggling to rise higher, grasping for whatever advantage they can get, and no one reaches a position where they can relax and turn a beneficent eye to the people below.

Distance. Representative democracy was supposed to close the distance between the rulers and the ruled. Leaders were supposed to spring up from among the people, and then go off to represent them in Congress.

Again, that’s been circumvented. No one who isn’t already well connected can hope to raise the money necessary to run for Congress or just about any other major office. And so we have a huge social distance between the leaders and the led.

That distance leads to disasters like New Orleans. The evacuation worked very well, Hayes points out, for people with cars. The leadership just underestimated the number of people without cars or what they would be likely to do, even though that information was available if anyone had thought to look for it.

So that’s the picture in failure after failure: A entrenched and entitled elite, hyper-competitive within itself, but distant from the people their actions affect.

What to do? It’s a basic part of our political rhetoric that we want equal opportunity, but want the government not to try to equalize outcomes. Hayes thinks that position is naive. With sufficient inequality of outcome, equality of opportunity is impossible. Meritocracy needs some inequality (or there’s nothing to win). But too much inequality destroys the meritocracy itself. So Hayes’ solutions are all about seeking more equality of outcome.

A second approach is something I’ll explore next week: moving towards a more anarchic system, where less responsibility is delegated and less is expected or demanded of elites. The text for that discussion will be The Leaderless Revolution by Carne Ross.

July 9, 2012 – 12:37 pm Categories: Articles | Comments (14)

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The Economics of Leviticus

Culture war conversations often end with a verse from Leviticus, the old testament book of laws. After the verse has been quoted, it does no good to point out that the implied solution is impractical or unfair or causes needless suffering. God has given his command and we should be carrying it out, whether it makes sense to us or not.

Strangely, though, the economic parts of Leviticus aren’t quoted with the same air of ultimate authority. If they were, Biblical literalists might have to become radicals rather than reactionaries.

For example, when vulture capitalists ruin towns by closing factories and shipping jobs overseas, someone might quote Leviticus 19:9-10, which clearly denounces business practices that wring out every last dime of profit.

When you reap the harvest of your land, do not reap to the very edges of your field or gather the gleanings of your harvest. Do not go over your vineyard a second time or pick up the grapes that have fallen. Leave them for the poor and the foreigner.

The foreigner? You mean, like, illegal aliens? Could be. Leviticus 19:33-34 says:

When a foreigner resides among you in your land, do not mistreat them. The foreigner residing among you must be treated as your native-born. Love them as yourself, for you were foreigners in Egypt.

It doesn’t say anything about a green card, it just says “resides among you in your land”. (Don’t argue with me, argue with God. I’m just reading literally.)

But by far the most radical part of the book is Leviticus 25, the chapter that institutes the Jubilee Year.

Consecrate the fiftieth year and proclaim liberty throughout the land to all its inhabitants. It shall be a jubilee for you; each of you is to return to your family property and to your own clan. The fiftieth year shall be a jubilee for you; do not sow and do not reap what grows of itself or harvest the untended vines. For it is a jubilee and is to be holy for you; eat only what is taken directly from the fields. In this Year of Jubilee everyone is to return to their own property.

“Their own property” includes anything that has been sold or repossessed:

If one of your fellow Israelites becomes poor and sells some of their property … [and] if they do not acquire the means to repay, what was sold will remain in the possession of the buyer until the Year of Jubilee. It will be returned in the Jubilee, and they can then go back to their property.

Basically, every 50th year all mortgages and foreclosures are cancelled and land goes back to its original owners. Anybody whose debts forced them into slavery is freed.

I know what you’re thinking: “That would never work.” And you’re absolutely right: It would never work with our modern capitalist notion of private property. But guess what? Leviticus has a completely different understanding of property:

The land must not be sold permanently, because the land is mine and you reside in my land as foreigners and strangers. Throughout the land that you hold as a possession, you must provide for the redemption of the land.

So the Earth itself belongs to God, while human deed-holders only own what the land produces.

If you sell land to any of your own people or buy land from them, do not take advantage of each other. You are to buy from your own people on the basis of the number of years since the Jubilee. And they are to sell to you on the basis of the number of years left for harvesting crops. When the years are many, you are to increase the price, and when the years are few, you are to decrease the price, because what is really being sold to you is the number of crops.

Leviticus was talking about an agrarian economy. If you wanted to apply this today, you might generalize to something like this: The Bible does not support private ownership of the means of production. The owner owns the product, not the means of production.

Taking Leviticus 25 seriously would force a sweeping re-visioning of the economic system. That would be a lot of work, and cause a certain amount of distress for the people who own property under our more free-trading definition. Why go to all that trouble? Unless you think this the Word of God or something.

July 9, 2012 – 11:59 am Categories: Articles | Comments (11)

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The Monday Morning Teaser

The big article this week started out as a review of Chris Hayes’ The Twilight of the Elites, but turned into a more general piece on institutional failure that I’m calling “In Search of a Universal F***-Up Theory”. Every place where our institutions are failing or disappointing us — in the government, the economy, or even seemingly unconnected areas like religion or sports — you can find a specific explanation that sort of makes sense. But what explains why they’re all failing at once? Hayes’ book is such an across-the-board explanation, but whether you agree with his theory or not, we need a UFT.

It’s still iffy what else I’ll have room for, but I’m working on two other things, one of which will run this week and probably the other next week: a defense of food stamps against the charge that they must be unnecessary because so many of the poor are fat, and the chapter of Leviticus I wish the fundamentalists would quote: Leviticus 25, which establishes the Jubilee Year, cancels debts, and implies a very non-capitalist definition of property. What if people were taking that as seriously as the Leviticus verse that denounces homosexuality?

What was everybody talking about this week? The heat, the Higgs boson, and the political fallout from the ObamaCare decision. And just because you need some cuteness in your life, I’ll link to a video of pandas playing on a slide.

July 9, 2012 – 6:55 am Categories: Morning tease | Comments (1)

Necessary Measures

Let the national Government be armed with a positive & compleat authority in all cases where uniform measures are necessary. 

James Madison
letter to  Edmund Randolph (1787)

Where we find that the legislators, in the light of the testimony and facts before them, have a rational basis for finding a chosen regulatory scheme necessary to the protection of commerce, our investigation is at an end.

Justice Thomas Clark
writing for the unanimous Supreme Court in Katzenbach v. McClung (1964)

This week I’m continuing to experiment with the format of the Sift. In particular, I’m combining the weekly summary with the Nuggets (which used to be called Short Notes).

This week everybody was talking about … the Supreme Court

Some days the Court seemed like the only thing to talk about. (Not true. Even on Thursday, ObamaCare decision day, I clearly remember my wife saying, “What should we do about lunch?”)

I look on the Sift as serving two purposes for its readers. Most weeks, it makes you aware of facts and ideas that you might have missed while you were busy living your life or doing some other silly thing. But it also sometimes covers issues that you hear too much about. This week, that’s the Court, whose decisions have been good/bad up/down right/left … who can keep track?

Here’s the short version: The end-of-term flurry of decisions were mostly OK. Yes, the Court missed an opportunity to reconsider Citizens United. But these two articles explain why the ObamaCare and Arizona decisions were as good as I could have reasonably expected.

  • What the Court Decided About ObamaCare. If the Court had just followed its own precedents, the constitutionality of the Affordable Care Act would have been a non-issue. But politics got into it, so the decision was 5-4, and the decision was more strained and nuanced than it needed to be. Still, in the end ObamaCare gets to go forward and 30 million people are going to get health insurance who wouldn’t otherwise have it.
  • What the Court Decided About Immigration. Flacks and fund-raisers tried to spin this in a variety of directions, but when you read the decision it’s clear that the Arizona immigration law went down. The immigrant-haters lost.

… but I also wrote about

  • I Was Undocumented in Arizona. As luck would have it, I happened to be in Phoenix when the Arizona decision came out. Part of the reason I was there was to protest S. B. 1070 and the treatment of undocumented immigrants in general. But it was ironic that (because I had left my driver’s license back home in a laundry hamper) I was undocumented myself for a whole week. Fortunately, I had the foresight to be born white.

… and you might also find this stuff interesting

Right-wingers are now vowing to stop eating Oreos. I wonder why.

Mississippi came within hours of legislating out of business the last abortion clinic in the state, but yesterday a federal injunction stopped the new law from taking effect.

After a 6-month investigation, Fortune magazine tells a very different version of the Fast & Furious gun-walking story:

the ATF never intentionally allowed guns to fall into the hands of Mexican drug cartels. How the world came to believe just the opposite is a tale of rivalry, murder, and political bloodlust.

Exxon’s CEO now admits global warming is happening, but doesn’t think it’s a big deal. We’ll “adapt” to changing temperatures, just like the dinosaurs did. The article does not include any comments from polar bears.

Surprising no one, Anderson Cooper announced that he’s gay.

Cracked.com continues to do useful journalism: The 6 Creepiest Lies the Food Industry is Feeding You.

I love whiteboard animations. This one gives a powerful Marxist critique of what’s been going on in the world economy.

July 2, 2012 – 1:24 pm Categories: Short Notes, Weekly summaries | Comments (3)

What the Court Decided About ObamaCare

Thursday, the Supreme Court announced its decision that the individual healthcare mandate, and hence the Affordable Care Act as a whole, is constitutional. It was a 5-4 decision, with Chief Justice Roberts siding with the Court’s four liberals and Justice Kennedy (the usual swing vote) joining the other three conservatives.

I was thrilled. Yes, Roberts got to that decision in an odd way (more on that later), and states were given the option to opt out of the Medicaid expansion. (I expect Republican governors to posture a lot about this, but I have a hard time believing they’ll actually refuse.) But the alternative was stark: We’d be back to square one on health care, stuck with 50 million uninsured Americans, spiraling healthcare costs that are already the highest in the world, and no plan on the table to fix any of it.

So we should all take a moment to do a happy dance.

Done? OK, now let’s look at this in a wider perspective.

History. Democrats have been trying to get some form of national health insurance since Truman. LBJ got Medicare and Medicaid passed in the 60s. Clinton tried and failed to get universal health care in the 90s.

Fear that Democrats might someday succeed in passing a Medicare-for-everybody plan that put private health insurance companies out of business caused the conservative Heritage Foundation to propose an individual mandate in the 1989 report Assuring Affordable Health Care for All Americans. The Republican alternatives to HillaryCare in the 90s usually claimed not to have mandates, but tax credits were jiggered to produce the same result: If you chose not to have insurance, you paid more to the federal government.

And of course, an individual mandate is a key and necessary provision of RomneyCare in Massachusetts, which Mitt explained here:

The interesting detail in all of this conservative campaigning for an individual mandate was that its constitutionality was never addressed as a problem. As long as it was a conservative alternative to Democratic proposals, no one challenged the mandate’s constitutionality.

In May, Salon’s Andrew Koppelman asked the question: When did the individual mandate become a constitutional issue?

The first exploration of Congress’s authority to enact a mandate was a paper by Mark Hall, which he posted on SSRN in February, 2009. (I have not been able to find even a hint of the constitutional objection before Obama’s election, even though mandates have been proposed, mainly by Republicans, since the early 1990s.) He concluded that the mandate easily followed from existing commerce clause jurisprudence. … The first published claim of unconstitutionality that I have been able to find is a July 10, 2009, Federalist Society paper by Peter Urbanowicz and Dennis G. Smith. They created the now notorious action/inaction distinction, declaring that “Congress would have to explain how not doing something – not buying insurance and not seeking health care services – implicated interstate commerce.”

Before that, nothing. Crickets.

What Roberts Said. So this is where we are: I did a happy dance because the Court’s partisan Republican majority only managed four votes to shoot down a Republican healthcare idea that Democrats finally managed to pass. Their constitutional objection was based on an ad hoc legal theory that simply did not exist until a few months before Congress passed the law.

Worse, in giving his OK to ObamaCare, Roberts still signed off on the ad hoc action/inaction theory and rejected the Commerce Clause justification that seemed obvious to everybody only two years ago. Instead, he re-interpreted the mandate as a tax and found justification for it in Congress’ constitutional power to tax:

The Federal Government does not have the power to order people to buy health insurance. Section 5000A  would therefore be unconstitutional if read as a command.  The Federal Government does have the power to impose a tax on those without health insurance. Section 5000A is therefore constitutional, because it can reasonably be read as a tax.

Now, I can’t complain too much about this, because I’ve been lamenting for months that the mandate would obviously be constitutional if Congress had just replaced the word penalty with tax. Of course, if they had done that, it’s possible that conservatives would have trumped up some novel legal theory that limited the Taxing Clause. Who knows? If you want to throw out a law badly enough, you can always come up with something.

The Ginsburg Dissent. If you want to see what would have been a 9-0 decision in the 1990s, and probably even an 8-1 or 7-2 decision two years ago, scroll past the 59 pages of Roberts’ decision and read the dissent by Justice Ginsburg. (She dissents from Roberts’ reasoning, but not his conclusion that ObamaCare is constitutional. So she is also technically part of the majority that Roberts is writing for.)

There is a very striking difference in tone between Ginsburg’s opinion and both Roberts’ opinion and the joint dissent by the four conservative justices. Ginsburg consistently talks about reality, giving examples and statistics about what is happening here and now in the healthcare market. Meanwhile, Roberts and the conservative bloc mainly discuss bizarre fantasies in which Congress might force everybody to buy broccoli.

At the root of the conservative rejection of the Commerce Clause justification is the idea that Congress’ power to regulate commerce does not include the ability to “create” commerce by forcing people to buy a product (health insurance) they otherwise would not. The objection rests on two points:

  • Individuals should be able to escape Congress’ commerce-regulating power by not participating in the regulated markets.
  • Individuals can choose not to participate in the healthcare market by not buying insurance, not going to the doctor, etc.

The first point sounds reasonable, but has no real basis in legal precedent. And Ginsburg correctly observes that because accident and illness strike even young and apparently healthy people without warning, and because emergency rooms are obligated to treat first and ask for payment later, the second point is just false. Individuals actually cannot avoid adding risk to the health-care system.

Insurance companies and health-care providers know that some percentage of healthy, uninsured people will suffer sickness or injury each year and will receive medical care despite their ina­bility to pay. In anticipation of this uncompensated care, health-care companies raise their prices, and insurers their premiums. In other words, because any uninsured person may need medical care at any moment and because health-care companies must account for that risk, every uninsured person impacts the market price of medical care and medical insurance.

This is also inherently a national problem, precisely the kind of thing that the Founders wanted Congress to have the power to solve.

States cannot resolve the problem of the uninsured on their own. Like Social Security benefits, a universal health-care system, if adopted by an individual State, would be “bait to the needy and dependent elsewhere, encouraging them to migrate and seek a haven of repose.” Helvering v. Davis, 301 U. S. 619, 644 (1937).

In normal times, that would be that. As a unanimous Court wrote in Katzenbach v. McClung (1964)

Where we find that the legislators, in the light of the testimony and facts before them, have a rational basis for finding a chosen regulatory scheme necessary to the protection of commerce, our investigation is at an end.

But these aren’t normal times, so Ginsburg has to attack Roberts’ examples directly.

An individual “is not ‘active in the car market,’” the Chief Justice observes, simply because he or she may someday buy a car. The analogy is inapt. The inevitable yet unpredictable need for medi­cal care and the guarantee that emergency care will be provided when required are conditions nonexistent in other markets. That is so of the market for cars, and of the market for broccoli as well. Although an individual might buy a car or a crown of broccoli one day, there is no certainty she will ever do so. And if she eventually wants a car or has a craving for broccoli, she will be obliged to pay at the counter before receiving the vehicle or nour­ishment. She will get no free ride or food, at the expense of another consumer forced to pay an inflated price.

So no, it doesn’t follow that Congress can make us eat broccoli if the Commerce Clause allows an individual mandate.

The Medicaid expansion. One of the ways ObamaCare increases the number of people with coverage is that it expands eligibility for Medicaid. Everybody under 65 with a household income less than 133% of the poverty line becomes eligible.

Medicaid is a federal/state partnership, so the expansion can only happen if the states go along. The ACA tries to make it painless for the states to cooperate by covering 100% of the cost of the expansion for the first two years, and 90% thereafter. It tries to make the expansion painful to turn down by saying that Medicaid is a take-it-or-leave-it deal. States can go along or lose the Medicaid funding they already get.

Roberts found that this was too coercive, though he didn’t specify what makes a non-cooperation penalty too high. Ginsburg finds that the Medicaid expansion is within the normal power of Congress to offer funding with conditions, and does not see the take-it-or-leave-it part as a penalty at all, since each year is a new appropriation, subject to its own conditions.

Future Congresses are not bound by their predecessors’ dispositions; they have authority to spend federal revenue as they see fit. The Federal Gov­ernment, therefore, is not, as the Chief Justice charges, threatening States with the loss of “existing” funds from one spending program in order to induce them to opt into another program. Congress is simply requiring States to do what States have long been required to do to receive Medicaid funding: comply with the conditions Congress prescribes for participation.

As I said above, I doubt the states will opt out anyway. If they do, then ObamaCare will cover somewhat less than 30 million new people, and the opting-out victims will be poor and near-poor people.

The conservative dissent. Justices Scalia, Thomas, Alito and Kennedy combine in a dissent that is both radical and polemic, full of scary quotes about the Commerce Clause turning into “a font of unlimited power” or “a general authority to direct the economy”.

Its conclusion is that the ACA must be thrown out in its entirety.

Think about that: Based on a legal theory that did not exist two years ago, and whose advocates are almost entirely in conservative think tanks, the Court came within one vote of striking down the biggest piece of social legislation in half a century.

Salon’s Paul Campo has an even scarier theory: Looking at internal evidence in the text, Campo speculates that the conservative dissent was originally written to be the majority opinion, and that Roberts changed his mind late in the game.

So we dodged a bullet, and the country gets to have RomneyCare. Unless it elects Romney. Then the Happy Dance will be over.

July 2, 2012 – 1:05 pm Categories: Articles | Comments (24)

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