Power Corrupts; Bureaucracy Enstupidates

This seems to be real. The fish that threatened national security.
the TSA supervisor was called over, and he berated me profusely. He exclaimed that in no way, under no circumstances, was a small fish allowed to pass through security, regardless of what the ticket agents said.

Mr. Supervisor was causing a grand scene, marshaling the full authority of the TSA to refuse me. Now, I know my fish is a terrorist (Osama Fin Laden we used to call him back at school), but doesn't it strike you as funny that, with all the commotion my little security threat was causing, by now engaging the full attention of the TSA at LaGuardia, that someone who posed a real threat to passenger safety might be conveniently slipping by?

By this time, I was in tears. The supervisor furiously told me to dispose of the fish. Dispose of my fish?!
Funny yet angering.
Controlling the Proletariat

Most people don't know that the police as an institution are a modern invention, part of the industrial revolution just like railroads. Those who know tend to assume that the reason the police were invented was a natural reaction to crime rising. This article challenges that notion:
contrary to the crime-and-disorder explanation, the new police system was not created in response to spiraling crime rates, but developed as a means of social control by which an emerging dominant class could impose their values on the larger population.

This shift can only be understood against a backdrop of much broader social changes. Industrialization and urbanization produced a new class of workers and, with it, new challenges for social control. They also provided opportunities for social control at a level previously unknown. The police represented one aspect of this growing apparatus, as did the prison, and sometime later, the public school. Moreover, the police, by forming a major source of power for city governments, also contributed to the development of other bureaucracies and increased the possibility for rational administration. In sum, the development of modern police facilitated further industrialization, it led to the creation of other bureaucracies and advances in municipal government, it consolidated the influence of political machines, and it made possible the imposition of Victorian moral values on the urban population. Also, and more basically, it allowed the state to impose on the lives of individuals in an unprecedented manner.
Crime rates skyrocketed when the police were instituted, not because they were naturally going up but because many sorts of new laws were created and imposed, that could have never been enforced without a standing army of enforcers.
Qveere Eye for thye Medieval Man

Kyan: "thy hovel moste certainly is a pigstye!"
Jim Henley's blogging has gotten noticed. He has a perceptive piece in The American Spectator
The conservative charge that Democratic candidates for president want to 'cut and run' from Iraq is unjust, which is too bad. We'd have a genuine debate then. With the partial exceptions of the minor candidates, the Democratic presidential candidates rush to assure us that we must stay the course. ... Their metamessage is that this election, to exhume a phrase, is about competence, not ideology; the chorus from the December 9 debate in New Hampshire: We'll fix Iraq better.

How? There is a single answer: Get foreigners to do it!"
As Jim says: "We'll get more international help is not a policy, it's a hope." Quite so. The opposite of engagement is disengagement, which makes sense to me. But clearly the American people are not ready for it; most are pro-war know-nothings. But the bike-path left aren't going to win with pro-war-lite. Prowar intellectuals correctly understand that war is committing, and if you are to do it you must do it "right". Doing it right - that's exactly what real anti-war intellectually are afraid of. Go read up on your War Nerd if you are a bike-pather and don't really understand war.
What is War

Was just googling to find Gary Brecher (the War Nerd), and found a great interview. Two of my favorite writers: Steve Sailer interviews the War Nerd for UPI. A choice quote: "Get it straight: massacres are normal, battles are unusual."

Here's more:
Q. When journalists [describe] various wars in Africa as 'senseless,' are they making sense?

A. That's the best question you asked. No, it's absolute BS but nobody calls them on it. If you guys were doing your job, they couldn't get away with it, but they do. When Kristof says 'senseless,' he means he doesn't WANT TO KNOW about it. He won't even try to think like the people doing the fighting. Try doing that and see if it still seems senseless.

Here you've got one kind of war, the 'sensible' kind with uniforms, 'rules of war,' and big battles like Jena or Verdun. That kind means you stand up and walk into cannon fire, grapeshot or machine-gun fire and massed artillery, and all you get out of it is a few dollars a month, and if you decide to quit on your own, they hang you. How is that sensible?

Now take African war. You have these neighbors you hated since forever, and you decide to do something about it. You get together quiet with the rest of your tribe and jump the enemy village while they're sleeping and kill everybody except maybe the cute girls, then you take all their stuff and burn their houses and take the girls home to be slaves.

Maybe I'm crazy, but that sure makes more sense to me than getting your head blown off for the glory of king and country.
As a fellow war nerd, I say read it all. Brecher is funny, which is why people read him, but what's he's saying is not funny. And it's more applicable now than ever, what with the Iraq situation.
The Origin of Property

It is sometimes argued by statists that creating property rights can only be done via the state. I think of that when we get snowstorms, as we did last week here in Baltimore. After a storm, the cost of creating a parking spot, combined with human beings' natural territoriality and innate sense of justice, creates property. It doesn't matter whether or not the practice is legal or not. People will claim the spots they create. The state is not creating this property; often it is opposed to it. But it happens nonetheless. Enforcement of the regime is easy enough, via anarchic individual action. When someone steals your spot, you retaliate against their car.

Here's some stories on the practice of winter parking spot homesteading. Given its roots in human nature, I expect it will be found anywhere where there is a combination of parking in a commons, and big winter snowstorms.

In Baltimore:
Shoveling mounds of back-breaking snow brings out the territoriality in Baltimore's automobile owners. Like flags declaring a pioneer's conquered land, Baltimoreans will use anything they can find to mark the asphalt their hours of work have uncovered.

In Boston, they do it:
If you're looking for a parking space in the wintertime, especially if it has recently snowed, be careful. Residents who shovel the snow out of a parking spot on the street will, for the rest of the winter (and sometimes into spring), view that parking spot as belonging exclusively to them. When their car is not in that spot, they will "reserve" the space by leaving a chair or a trash can or anything else they have on hand in it. If you should remove this debris and park your car there, you may find scratches, broken windows, or some other damage to your car when you return. Be careful!!!

Don't think too badly of the Bostonian for this lapse in friendliness. There is so little parking around town - and the snow makes it that much harder to get a decent spot. I've spent hours shoveling snow & chipping ice out of a spot. And when somebody else "steals" your spot, it forces you to "steal" your neighbor's spot.

Some people don't "get it" naturally, as happened to a callow youth in Troy, NY:
The man pointed to my car and asked if I knew who owned it. I replied that it was mine.

I informed the man that I had spoken to officers in the Troy Police Department, and that they had told me that the laws that permitted residents to reserve parking spots with garbage cans had been repealed three years ago, and that parking on the street was fair game.

The man didn't seem to care, and he demanded that I immediately move my car or else he would have it towed. When I reminded him that the law was on my side, he threatened to slash my tires, which I suggested might not be such a good idea, seeing as I knew that he lived next door. Naturally, my neighbor began to hit the side of my car with a snow shovel, something that is apparently a customary way to ask another to move his or her car in South Troy.

In Chicago, the system has (necessarily) been perfected:
Rule #1: If you shovel a spot after there has been enough snow to make it difficult or impossible to pull in without shoveling, it's yours. If there are two inches of snow on the street and you try to save a spot, drop dead. I'm not saying anyone OWNS a parking spot. There's a difference. If you do have the right to a spot, be creative and put something truly hideous there that suggests you have no taste, no shame, and certainly no problem causing serious property damage to anyone who moves your junk.

Rule #2: Peeling out of a spot for 10 minutes and leaving a ton of snow everywhere does not count as shoveling. You have not actually removed any snow, you've just sent it into the street and into the spots on either side of you. Lazy bastard! Don't even think of putting that milk crate there, your neighbors have eyes everywhere and they will steal it.

Rule #3: If someone moves your stuff out of your spot, tosses it aside in the snow, and then takes your spot, you are free to pour some nasty liquid on their car, especially if you put a lot of work into clearing that spot. If it took me more than an hour of back-breaking labor, that car would feel my rage. I still laugh thinking of the old man on my dad's block on Wolfram near Southport who actually dragged a chair and hose out and sat there all afternoon icing down someone's car. The cop who lived next door came out and shot the shit with him for a while, and then just asked him to stop. That's justice!

Rule #4: If someone goes a step a further and STEALS your stuff out of your spot (even if it's junk, which I hope it is) and then takes your spot, escalate the property damage accordingly.

Rule #5: If someone has the audacity to take your spot and then put their own junk in it when they leave the spot, that has serious, serious repercussions. That is beyond rude, that is an actual assault to your dignity and to the dignity of humanity. I would recommend breaking windows, scratching a key on every single panel, or knifing the tires. Or even better, doing all three. "Listen to your heart," as Fat Tony on the Simpsons would say.

You may be afraid to take action when someone steals your spot because you wonder how you know if the person parked there was the person who took it in the first place. Well, if it's been less than a few hours I'd say the chances are really, really good. But yes, if you aren't sure, play it safe. Then again, if someone sees a spot that looks too good to be true, e.g. it's neatly shoveled and there is a giant ironing board in the snow next to it, I'd say they ought to know better and stay the hell out of it.

Am I insane? Yes. But try to find a cop who gives a shit when you call up and claim someone iced your car. They know the score.

Chicago economics professors have noticed the phenomenon:
The tough issue is whether the Chicago system is better than any real-world alternative. Writers who condemn the practice treat the situation as one of mere distribution of a given amount of parking space. But an economist would predict that permitting private property would incite others to expand the amount of space. And so it does. Not only do those who dug out their cars the first morning have a space thereafter, but neighbors whose cars were not on the street begin to hack away the snow masses created by city plows to make a space for themselves. As black patches increase, the snow melts fast along the cubs. In both respects, the result is not just distribution of a given quantity of space, but creation of more space.
To me what's most interesting is not whether or not the system is efficient. It's the simple fact of the creation of private property outside of the law. The state is not necessary for private property to exist.

Back when I was watching Farscape, and complaining to scifi friends about how nobody would stay dead, everyone (and I mean everyone!) was telling me that I would love Buffy. That was before I had seen a single episode. Having now watched all of Buffy (except the season 7) via the magic of my Replay device (a DVR), I can confidently say: they were right! Joss rules. Joss kills 'em like flies, and at least some of 'em stay down. I don't ask for all of 'em. Just some. Thanks, Joss.

Now we have on radar a remake - er, "reimagining" of Battlestar Galactica. I vaguely recall the original series, having been the perfect target demographic at the time. But I have no strong attachment. The new thing... any good? Well, I'll see tonight. I have #1 on the DVR, with #2 slated to air tonight. Meanwhile, this review makes it sound quite promising: "this is definitely one of the darkest sci-fi shows I’ve seen in a while."
Everyone is paid, except one

In the Journal of Medical Ethics, a call for a market in human organs:
There is a lot of hypocrisy about the ethics of buying and selling organs and indeed other body products and services for example, surrogacy and gametes. What it usually means is that everyone is paid but the donor. The surgeons and medical team are paid, the transplant coordinator does not go unremunerated, and the recipient receives an important benefit in kind. Only the unfortunate and heroic donor is supposed to put up with the insult of no reward, to add to the injury of the operation.

We would therefore propose a strictly regulated and highly ethical market in live donor organs and tissue.
They probably mean "regulated" as coercive, but it can be read as voluntarist by the anarchist.
An Alien State

Fred Reed, living in Mexico, writes on The Virtue of Lawlessness:
In fiesta season, which just ended, everybody and his grand aunt Chuleta puts up a taco stand or booze stall on the plaza. Yes: In front of God and everybody. These do not have permits. They are just there. If you want a cuba libre, you give the nice lady twenty pesos and she hands it to you. That's all. There is in this a simplicity that the North American instantly recognizes as dangerous. Where are the controls? Where are the rules? Why isn't somebody watching these people? Heaven knows what might happen. They could be terrorists.
Yes Master

At samizdata, Natalie Solent has a great piece on the effects of men owning other men. Application: medical research. "Slavery is: work for nothing. Slaves are: lazy, obstructive, lacking in zeal. "The work is not well done." Yes, life must have been tough for the owners of lazy slaves. And it always will be. Important work is done by free men."
Segregation in Public Facilities

Via DeCoster, I found this article:
Transgender, gay and feminist groups at the University of Chicago are asking officials to consider creating more gender-neutral bathrooms, saying some people aren't comfortable selecting a gender-specific facility.

"Persons who are not easily legible as male or female often experience various forms of intimidation in these places. If a woman in a women's-only restroom is assumed to be a man, there may be real threats to her comfort and even safety," warns the Coalition for a Queer Safe Campus
PC gone amuck. Kind of funny.

I doubt that in an anarchy there would be any trifurcated bathroom system. Nonetheless, on this issue the transgendered people are right. The state should not discriminate on sex. It should not have separate-but-equal anything - schools, jobs, and yes, even bathrooms. Of course, the fact is that most people like sex discrimination. I do too. But that has nothing to do with equal treatment under the law. It's just a preference. We don't racially discriminate regardless of what the poll numbers on it are.

The right answer to the problem here is simply that the state has no business doing anything where discrimination is necessary. It should not be running universities. A private university can discriminate against transgendered people, and probably should (at least, in terms of economic efficiency it should). But if the state insists on supplying education, it should make bathroom facilities open to everyone. Anything less is unequal protection.

The problem here is not the trangendered activists: they are a symptom. The problem is state ownership of the means of production.
Anarchy on the Field

An interesting post at Samizdata: sports as anarchy.
The Organization of the Political Means

Wandering the blog world, came across an interesting blog item. The author is an Iraqi who appear to have been there through the recent unpleasantness. This post is dated Aug 30:
The looting and killing of today has changed from the looting and killing in April. In April, it was quite random. Criminals were working alone. Now they're more organized than the CPA (Coalition Provisional Authority) and the troops combined. No one works alone anymore- they've created gangs and armed militias. They pull up to houses in minivans and SUVs, armed with machineguns and sometimes grenades. They barge into the house and demand money and gold. If they don't find enough, they abduct a child or female and ask for ransom. Sometimes the whole family is killed- sometimes only the male members of the family are killed.

For a while, the men in certain areas began arranging "lookouts". They would gather, every 6 or 7 guys, in a street, armed with Klashnikovs, and watch out for the whole area. They would stop strange cars and ask them what family they were there to visit. Hundreds of looters were caught that way- we actually felt safe for a brief period. Then the American armored cars started patrolling the safer residential areas, ordering the men off the streets- telling them that if they were seen carrying a weapon, they would be treated as criminals.
This quote is almost too good to be true for an anarchist. Anarchy releases criminal elements (the unorganized political means). This is opposed by the armed people, which works: "we actually felt safe". But the state interposes; it will not permit any challenge to its monopoly, regardless of the price that the peons pay.
Gay Marriage: Politics

Meanwhile, there's an interesting aspect to the developing story of gay rights that I haven't seen talked about yet, so I thought I'd bring it up in case you want to think about it. And that is, that outside of some fairly small (but important) issues, gays on the whole are in many ways a natural Republican constituency. They're on average white, educated, high income. Of course, the Republicans will never give up the religious right (~15%) for gays (~3%). That's simple math. But if the political party is more or less impotent to legislate, then both factions can live under the tent. This is the case for, i.e. abortion: because of Roe v. Wade, the ability of the party to make serious change is null. Thus there can be prochoice Republicans - it's an issue, but not a party-central one.

The Republicans can benefit from gay marriage, assuming that they don't do anything in the coming backlash that locks them in as the antigay party. If the courts manage to legislate gay marriage, and there is not the democratic wherewithal from the legislative branches to stop it, then we may well see gays abandon the Democrats in the coming years.

If, on the other hand, the Republicans manage to pass an antigay Constitutional amendment, then they will alienate gays more or less permanently. I wonder if Rove is working this angle yet? Gays might be secured to the Republicans in a matter of 10 or 20 years. It will take generations for Hispanics to go Republican, if they ever do, seeing as they are already on the transfer-payment gravy train.
Gay Marriage: Woohoo!

A great decision in Mass. Garth writes a good bit about it.

I know there are a few libertarians that oppose it. The argument can be made: state-sponsored marriage gives unwarranted privilege (which is true), such as the privilege to force an insurer to cover you simply because they cover the spouse. Expanding marriage expands this rights violation. But that must be weighed against what marriage offers: some of the most fundamental rights that humans have. The right to proxy decisions. The right not to be forced to do certain things against your will (i.e., to testify against a loved one). And the right to control your own property: to have less taxes stolen from your income, or as inheritance. These and many other aspects of marriage are freedoms that everyone ought to have; expanding them to allow gays to have them too isn't much, but it is something.

Of course, the symbolic aspect of this decision is huge. It won't have much effect on the real world - gays are a small minority, after all. But it's a huge win for human liberty.

Matt Taibbi writes that America needs to get tough in Iraq:
The spectacle of last week’s embarrassing events ought to send shivers up the spine of anyone who derives comfort from our great power status. In case you missed it, the U.S. responded to a series of suicide attacks with a volley of deranged, incoherent strikes at empty buildings. In particular, the U.S. rocketed an abandoned dye plant at the edge of Baghdad, making sure that it was empty first, and not even destroying the structure but simply shooting it full of holes to render it dysfunctional. It had not been functioning anyway. The "new ‘get tough’ policy" (what was it before?), code-named Iron Hammer, was designed, allied commanders told reporters, to "send a message." Here is how the AP described that "message":

On Thursday, U.S. soldiers with loudspeakers drove through the neighborhood warning occupants to leave before the impending strike. Later, at least nine large-caliber shells were fired into the empty plant, heavily damaging the structure. The tactical goal was not immediately clear since this sprawling metropolis of 5 million people has other sites to launch attacks.

That last sentence, with the "sprawling metropolis" line, is about as sarcastic as wire service reporters get. Since the collapse of the Soviet Union, the AP has reigned as humanity’s most impenetrable fortress of unfunniness. So when even they are laughing at you, you know you have problems.
Economics is not Science

Last week Garth over at America's Outback posted some criticism of Austrian economics. I've been wanting to respond to it, but I haven't made the time. Well, enough of that - do what you can.

I'll take the last question first, as I think it is illuminating:
Austrians, were is all the math to back up your views? You seem light on models. So far my reading has seemed more like philosophy than economics.
Yes, precisely. In the Austrian view, economic knowledge can only come from two places: reason and introspection. This is a radically different methodology (they call it praexology) than mainstream economics. On the face of it, it is crazy-talk. And I don't completely accept that one should do completely without data, models, and all the other physics envy. Still, when you think about it there is something to recommend it. People's tastes and desires are not open to our examination; indeed they are impossible to measure in any absolute way. We can get relative information about people's tastes (via revealed preference: "I'll trade you the orange for the apple."), but we can never get any absolute information. ("I like the orange three utils more than the apple.") It is hard to get honest information from people - only by watching them act with real money (goods, value in general) on the line, can we see what we think are honest actions. Furthermore, people are not always rational, either because of lack of information, because they are stupid, because we have built-in irrationality (that we can in theory characterize), or, in the worst case, just because we are ornery. Building any theory based on this slippery substrate is difficult at best.

I think that trying to test theory against reality is, even if extremely difficult, worth trying. But there always comes the problem of how to interpret what you find. History is problematic that way, because it only happens once. We can't rerun it, varying the conditions each time, the way we'd like to (from the scientific POV). Ultimately, I find it much more satisfying to look at things like money from the Austrian standpoint than to try to figure out what is going using econometric data. Malinvestment is a logical consequence of money creation. That much is true in all possible worlds (given certain assumptions). How large of an effect it has - that, theory tells us nothing about. It is not logically safe to identify any feature of the real world with the theory. In particular it is not sound to say that the predicted "business cycle" is in fact the business cycle that econometric data see. Still, that is my odds-on bet. But that's going to be an awfully hard thing to prove.

Proving causation in the real world in something as large as the macro economy is hopeless. That's why we need economic theory, and why praexology makes a certain kind of sense. So, to take one example, there's there issue of who to blame for the 90's tech bubble:
Where do I lay the blame? The private sector’s misallocation of capital as was clearly evidenced by massive investment in firms whose P/E ratios were infinite. Remember the “new paradigm” where old measures of value were discounted, cash flow was considered a meaningless concept, and the Dow was going to 36,000? Fed policy did not create any of this, a mania did.
Yes, but who created the mania? Perhaps central banking did; perhaps not. We can't tell. What we do know is that Greenspan et al were creating a boatload of money. Connecting the two we simply cannot do with any logical rigor.

As an Austrian, I look at it this way. A shady character was seen lighting a match in the vicinity of a building that later burned down. Was it arson, or just irrational flame exuberance? In the case of the economy, we know that the Fed was (and is) creating lots of money, which must cause malinvestment And we know there was a bubble. I choose to connect the two. It's not a hard connection to make, just hard to prove anything about.

But let's run with it, anyway.
The argument... is that economic recessions; the recent bubble in tech stocks; and all manner of horrors are the fault of the Federal Reserve making interest rates artificially low thus encouraging mal-investment. Presumably this all has to do with the failings of “fiat money” and the inefficiency of the public sector in comparison to the private sector in allocating capital.
The banking system is not exactly public, nor is it completely private. I would not place the blame for the malinvestment on that: it's not that there is necessarily a certain amount of bungling of investments. Rather, it is that there is too much investment. No matter who is running it, public or private, you simple cannot channel more money into capital goods than the market wants, without creating a lot of useless factories. That's what the theory says: the interest rate has a communicative function. It signals entrepreneurs as to the overall level of future demand. If you communicate massive future demand falsely, then you will induce a lot of people to borrow and build stuff that won't actually be fully utilized in the future.

Here’s what seems so weak about the Austrian theory of the business cycle: it assumes that businesses, entrepreneurs, financiers, and other investors take their cues solely from current Fed interest rate policy and without an ability to forecast a future realignment of those interest rates.
No. This reverses cause and effect. The interest rate does not cause people to borrow money. Rather, it is people borrowing money that creates the interest rate. It is a statistical construct; the reality is a million loans of various sizes, rates, etc. The Fed is shoveling money into banks (who loan it out, multiplied); it is the finding of enough borrowers that affect the interest rate. The point here is, people will be found. Yes, perhaps some or even many in the market anticipate higher interest rates. Perhaps everyone smart does. So what? The bankers will keep lowering the interest rate until they are fully loaned out. They do this because their license to print money is conditional: they only get free money as loans, not outright. If they have to find shady borrowers to take the money, they will. In fact the more "smart entrepreneurs" there are, that disbelieve the interest rate, the worse the resulting borrowers will be. That is the problem.

It is odd that the theory ... seems to assume that all long-run decisions are based on short-term, government interest rates when in fact (and I know this from a practitioner’s perspective) long-term investments are made based on the credit markets long-term interest rates.
It is not the short-term interest rate only that is forced down. This would be the case, if we imagine that the Fed would sometimes create money, sometimes destroy money. But they don't, at least in the longer run. They always expand the money supply. That's why the dollar is worth 1/4 of what it was in 1970. So bankers getting new funds coming in have no incentive to retain reserves against Fed deflation.

Furthermore, while Garth has experience with big borrowers, those are not the only borrowers in the market that fractional reserve lenders are trying to reach. There's also credit cards, home loans, car loans, small business loans, etc. These tend to be shorter term loans, in the case of credit cards, as little as a few weeks. So short term rate should apply to the extent that any do. Further, it's worth pointing out that consumers are notoriously less savvy as "entrepreneurs" than big business. Expecting everyone with a credit card to be a proto-Austrian who will discount the discount rate due to the Fed's evil influence is just silly. They're rationally ignorant. All they see is that if they refinance their house, they can take out $10000 in equity and buy a boat! Oooh!

The vast majority of credit in the economy is not created by the Fed, it is rationed by the private sector. Austrians argue that the banks are a collective cartel whose lending is artificially stimulated by Fed actions and desires. This completely ignores the tremendous amount of credit created by other actors in the economy such as General Motors which is not a bank, is not regulated, is not a part of the cartel yet which I believe (at least until recently) creates more credit than any bank in the system.
I would hope that the Fed has not yet crushed all private savings, and that is true. Private savers - including GM - certainly do play a part in the credit economy. But the point is, they should. That's the private market in action, is all. Nothing to see here. Sure, the Fed and the banks only create some fraction of the money. So what? They are still causing malinvestment. As such they must necessarily destroy wealth, causing business failure.

The thing to focus on is not credit creation, per se. Credit creation is a perfectly moral and rational behavior. Rather the problem is a particular species of fraud, fractional reserve banking, in conjuction with a particular species of immoral coercive action by the state, central banking. Fractional reserve with no moderating central bank was bad, not only because it would have bank runs, but because it was inflationary. Central banking would be wrong regardless of whether or not they allowed fractional reserve.

I will certainly agree that the combination of the two is more stable that the former system. However, solving a problem with a greater violation of liberty is, IMO, not the right solution. Rather, the whole business of fractional reserve should never have been allowed. Further, I don't think that creating a massive banking cartel somehow creates a crash-proof bank. What it does is to insure that the entire system fails in unison. It has not failed. Not yet. However, for a system to stand for 70 years is not proof of eternity.
Arnold Kling is ripe for the The Sect of Austrian Economics. Actually I doubt he will come around on defense. Just remember Arnold that war is the health of the state. But let me talk about the Austrian theory of the business cycle, and the analogy Kling makes to restaurants. Briefly stated, Kling gets it all wrong.

One the key Austrian insights as regards money is that, ideally, the interest rate is a market-created phenomenon. People don't actually hold more than token amounts of money as money. Instead they either spend it (consuming now), or invest it (consuming it later). All spending is aimed towards consumption; the question is simply now or later. The interest rate is a price, like the price of bananas, that reveals the outcome of that negotiation by all parties in the economy: from both the consumer/investor side, and the producer/borrower side. Alternatively it can be helpful to see the spend/save decision as a decision to spend, either on consumer goods or capital goods.

Now what happens when the interest rate is in some manner falsified? Well, as economists we know what happens when the price system is interfered with: it's always bad. Let's take for example bananas. What happens when the price of bananas is falsified? If the price of bananas goes low, then producers cease to supply them, and consumers find them a great deal. Thus a shortage erupts, and (absent the ability for the price to change), bananas must be rationed by some non-price method. If the price of bananas goes high, then producers rush to plant more trees, banana production increases, but meanwhile consumers aren't buying. Bananas pile up in the stores. Bananas rot.

Bad outcomes result no matter if the price if falsified as too low, or too high. (And note that you are invited to plug in "marginal" in the above paragraph in 27 places if that helps you feel good about it.)

The same is true with the price of money. Interest rates are routinely depressed via central bank manipulation. This will predictably cause people to stop saving (why save if interest rates are pathetically low), and it predictably will cause capital spending to increase (the rate signals that people want goods in the future). So people spend on current consumption (keeping all of the businesses concerned with current consuption busy), and businesses expand (keeping all of the businesses which make capital goods busy). Everyone is busy - that's a boom. But there is no future consumption - the businesses were fooled. The interest rate "lied" to them. So eventually, when the new productive capacity comes online, there is overproduction. More is being produced than people want to consume. The capital structure of the economy is disaligned with the consumer reality. That's the recession part of the cycle.

Now, Kling makes some very imprecise restaurant analogies from the simple theory above. You can read them yourself. So what's more straightforward: the idea that waiters can submit extra orders, and thereby cause the cooks to be frantically busy? Or that the cooks just get manic every so often? If you think of there being only one or two cooks, maybe that is plausible. But we are analogizing cooks to be the entrepreneurs and business owners of the whole economy - so we must imagine many, many cooks. How likely is it that 100 cooks in a large restaurant all happen to be manic-depressives, and all skip their medicine the same day, and all get manic together? Yet Kling is apparently happy with the notion that all of the sanest, wisest leaders in a modern economy can get a bit manic synchronously.

By contrast, what are the waiters being analogized to? Banks. Banks are the middlemen in the economy between people saving and business. What are the chances of a large number of a waiters all turning in extra orders? Well, in a normal restaurant not large. But that's where the analogy just fails. For in our economy, banks are cartelized, and there is one single central bank which can cause the entire system to inflate. So, in terms of the restaurant analog, we might imagine that the owner hangs out at the place. He believes that the waiters are deliberately "under ordering" food, and he thinks he should therefore "juice the kitchen economy" by making lots of orders that he is sure the patrons will end up wanting. But if the waiters aren't under ordering, what we have is a system that will waste a lot of food.

Note that this analogy does point out one thing wrt the theory of the business cycle: it is quite possible for the system to be in a steady state, the owner continually falsifying kitchen orders and food continually being wasted and thrown out. Only if the owner submits his extra orders in blocks (then backs off when the piled up food is clearly visible) do we get something analogous to the business cycle. Which of these is better analogous to the real economy, I don't know. What is clear, though, is that no matter how it happens, for the owner to order extra food that nobody wants is clearly wasteful.
Everything has an End: oooh, Deeeeep, Dude!

Saw the last Matrix movie over the weekend. It's crap. Oh yes, lots and lots of shoot-em-up bang. FX still amazing, though, we've come to expect that, haven't we, Mr. Anderson? Some nice new PC type heros. But there's nothing left of the old Matrix (#1), except parts of the look and feel. It's a inflatable doll of a movie, where there used to be a real live woman. It's paint by the numbers. It's cell-phoned in.

The first Matrix really was fresh, though it was marred as scifi by the utterly silly explanation for why the machines keep around humans. Still, it was possible with a small leap of imagination to get past that. Maybe the machines actually want to harness humans to do interesting things for them that they cannot do well themselves. Who knows. Meanwhile, the scene between Agent Smith and Cypher alone was worth the price of admission. The philosophy was, if obvious, nifty.

The second movie was bloated, but still a pretty good movie. The philosophy was perplexing. Many at the time took this as a good sign, signifying that there was a real philosophic destination the filmmakers were going to, and that the viewer needed to work a little bit, and it would be worth it when the 3rd movie came out. I always suspected it merely indicated that the filmmakers were reaching for Philosophy, at the film-student level of understanding (that is, near zero). Still, I was happy to play the game of philosophize in the blanks. I was happy to speculate on what was really happening, and what would happen. When Neo talks to the Oracle, that's a great scene.

Well, here's movie #3 and now we know for sure: the second movie was just slinging around big words. Reality is hard to underand not because it is complex. Rather, it is hard to understand because it is magical and follows no rules. Philosophy has been replaced by action, meaning by explosions, self-consistency with a cute kid. The movie is hollow to its core. Oh, sure, go ahead and see it - you want to know how it comes out, right? Well, probably worth the eight bucks on that score, but as a testament to the first two movies.

In my mind, the Matrix trilogy ends when the Architect offers Neo the choice. That's cute, but drastically stupid. I don't know where it should have gone, but I'm sure I'll think of a suitable ending.

The movie world is a hard place for the real scifi lover. It's full of visually-oriented fantasists who think that the future will look neat, and therefore, that they should be setting their magical fantasy films in the future and selling them as scifi.
The parable of the trees

Once there were two people living in a primeval forest. They were innocent, and had no notion of laws or property. Now, Adam liked apples, but they were hard to find in the forest. One day he invented the idea of farming. He realized: if I cut down some of the trees, that will create a clearing. Then I can plant an apple tree there, and then eventually it will grow and produce apples. So, he chopped down some trees (luckily he had an axe handy), planted some apple seeds, and went on his way.

Eve came along. Eve did not particularly like apples. She thought: how lucky to find this nice clearing, but how unfortunate that there are apple trees growing here, and not yummy plums! Then she had a flash of creativity, and invented the idea of farming. She thought: if I tear out these apple trees, then I can plant some plum trees, and then eventually they will grow and produce plums. So she did, and proceeded on her way.

Later on, Adam returned to the clearing. Seeing the plum trees, he was puzzled. I know I planted apples, he thought. Hmm, that's odd. He tore up the plum trees, and planted apples.

Later on, Eve returned to the clearing. Seeing the apple trees, she was perplexed. I know I planted plum, she thought. Oh well, whatever. She tore up the apple trees, and planted plums.

The next spring, Adam returned to the clearing. Seeing the plum trees, he got a little angry. Someone else is tearing up the apple trees! This time I'll hang out here so I can guard the trees. So he pulled up the plums and planted more apples, and he made his camp there.

A couple days later, Eve came to the clearing. She said to Adam: what have you done to the lovely plum trees I planted here? He said, I tore them up. I like apples. Well, she said, I like plums. So she tore up his apple trees. He tried to stop her, but being innocent he could not force her to stop, and she darted around him to get the trees. He said, If you plant plums, I'll tear them up. Well if you plant apples, I'll tear them up, she shot back. They glared at each other.

Then she had an idea. She said to him, how about we both plant trees? I'll plant a plum tree over here, and you plant an apple tree over there? (Eve was known for uptalking even then.) Adam said OK, so they both planted a tree.

Later that week, Eve returned to the clearing and pulled up the apple tree, and planted a plum tree. After all, she didn't like apples.
The parable of the pie

Once there was a man who loved apple pie. But he didn't know how to make it. He knew how to make pumpkin pie. His neighbor was a friend, and sometimes he would take a pumpkin pie over to share with her. Sometimes she would make an apple pie and bring it over to share with him.

One day they were talking, and he asked her: How do you make such wonderful pie? She said, well, it's not hard. Just apples, crust, and spice. Spice? he said. Yes, spice - nutmeg and cinnamon. I see, he said.

So the man thought, now I can make my own apple pies. He put cream, eggs, apples, nutmeg and cinnamon in the blender, and whipped them up. Then he poured the pies and baked them. It wasn't very good.
The parable of Laketown

Once there was a small town in the mountains called Laketown. It sat next to a small lake in a deep valley. The lake was drained by no stream or river, and so its level would fluctuate up and down. But it never raised very high, because the people in Laketown would prevent that. Long ago, their ancestors had built a clever bucket-carrying system at one end of the valley. Volunteers would gather there when the lake rose too high, and together they would carry water up high enough to spill it over into the next valley. In fact they didn't really have to lift the water very high - that end of the valley was split by a deep canyon. Some people said that the canyon had been cut by water, and that was proof that in the prehistoric past the lake had been higher. But most people pooh-poohed such talk, pointing out all the land that would be flooded in the valley if the lake were to rise even a tiny bit above its current level. No, they said: the lake must stay where it is. Too much is at risk. In any case, they said, it's no big deal. Just a few days each year, and a few people can prevent any flooding.

Time went on, and Laketown prospered. But there was a problem. The climate around Laketown changed and became wetter. (Some folks said that the new farms and roads that people were building affected the weather.) People had to spend more time each year carrying water to prevent flooding. In fact there weren't enough volunteers, and the town flooded several times. What panic! So the people got together and made flood control mandatory.

It was called the Mandatory Volunteer Lake Control Program. Early on, helping out was only required for the biggest farmers, and the ones nearest the lake. But they weren't enough. More days of rain came, so they extended the Program to everyone. First for a few days each year, which everyone thought was OK except a few grumblers. But then it rained, and rained. And it became 10, 20, 50, 100 days each year. The people groaned, but nobody could see anything to do. If they let the lake rise, wouldn't they be ruined? Sure it was objectionable to be forced to spend half your life carrying water, but wasn't that the price that one had to pay for civilization?

Pretty soon everyone was working 200 days a year, just bailing the lake.

One man rose to address his fellows. He said, My Friends, we're attacking this problem in the wrong way! If we just let the lake rise a little bit, then it will be high enough to once again spill down the canyon where it once ran. Then we won't have to spend any of our time bailing!

He was, of course, shouted down. Everyone knew that the only way to prevent flooding was hard work. So they exiled the man, and returned to their work.
Review: Manias, Panics, and Crashes: History of Financial Crises by Charles P. Kindleberger

Recently I spent time in America's outback with a friend with excellent credentials in economics in general and big-money investment in specific. We argued, as libertarians are wont to do, over fine points of theory. In particular I expounded Austrian economics. He doubted, and gave me this book, Manias, Panics, and Crashes, to read. A good thing too, since the flight into flyover territory is rather long.

Having finished it, I think it is a good book from the point of view of a sort of passive-voice history: a history of facts. So and so was here, and did this, said that. A battle was fought. Lives were lost. It is a history devoid of theory, almost, and therefore hard to understand. In this case, it's about financial history, but only the panics. A fraud was discovered. A panic started. Money was tight. Money moved. A lender of last resort appeared, or didn't. Missing from all that is the why: why do bubbles happen? What is speculative mania? Why do bubbles pop? Kindleberger does not explain these things; a sense of the economic structure is quite missing. In fact he willfully ignores most of them: the economic expansion period preceding a bubble he explicitly disattends.

It all reminds me of reading biological tracts written before the theory of evolution. Before then, it was quite evident that animals were designed, and designed pretty well. Much good work was done without evolution; but you could see ever so much more with that simple theory to guide you.

In the case of Manias, there is an abject ignorance of the theories of Austrian economics, in particular the theory of the business cycle. I doubt Kindleberger had heard our theories when he wrote the book. It's a revised edition I read, so there is all of one paragraph in the entire book where Kindleberger notes that there's this "new" theory about but dismisses it out of hand. (The fact that Kindleberger was completely ignorant of Austrian theory about the business cycle, which dates to Von Mises in the thirties, is a sad reflection on the damage Keynes inflicted and continues to inflict on economics.) In the Austrian view, trying to understand panics without understanding credit and money creation is like trying to understand for what purpose God put nipples onto men.

Kindleberger has no notion of where manias come from. To Kindleberger, they are just a given. Mania happens. People are irrational, and sometimes they just get nutty. End of story: now let's see how it unravels. That's not good enough for me. I'm an Austrian economist. The massive fraud of fractional reserve banking is what underlies the business cycle, including mania and crash if the swings are high/low enough.

To be specific, the source of mania is fractional reserve banking. In fractional reserve, demand deposits are lent out. The same money is supposedly available to the deposit any time he wants, even when it has been lent to somebody else. Banks are technically bankrupt at all times. There are real effects to this practice, even with all the moderating superstructure built by the modern state to try to prevent bank bankrupcies. In particular, when money happens to be flowing into banks (for whatever reason), it induces them to create and lend out large amounts of new money in an actuarially unsound structure. This falsifies the signalling that interest rates provides to entrepreneurs, and causes a boom. When money flows out of banks, the reverse must happen: they must reduce the money supply by a multiplied amount. But because the money is tied up in promises (which is what credit is, ultimately), it cannot be got easily. Thus the fundamental bankruptcy of the bank is exposed. Without state intervention, rational depositors, seeing that their bank is bankrupt, rush to extract their deposits. Panic ensues.

The state has, over time, evolved a number of ways to prevent the bankruptcy of banks. (Why, one might wonder. Is it for the good of the depositors, or the bankers?) With deposit insurance and the lender of last resort, there is no bank run. But there still must be the adjustment of the economic structure to reality. The structure was overbuilt due to false interest rate signals. Thus it must be partly liquidated. This process is recession.

Yes, a "lender of last resort" does help, in the sense that it can cut off a panic. But what is does not do is cut off the business cycle, nor the fundamental fraudulent nature of the system. Furthermore, the lender of last resort is itself, ultimately, just a big bank. Thus it, too, can be bankrupted if the crisis is large enough. What we have done, therefore, in tying all the US banks into one system is to guarantee that when failure happens it is absolutely catastrophic.

It is like playing double-or-nothing when one loses at blackjack. As long as the streak of losses is not too long, you stay ahead. But when you get unlucky enough - and it will happen - then you lose all. Meanwhile, though, you can be lulled into thinking that with your fancy betting strategy you have achieved something for nothing.

Perhaps an even better analogy would be in the way that the state has historically fought forest fires, without really understanding them. The more you fight fires, the more unburned stuff piles up in the forests; eventually a fire breaks out that you cannot contain. Modern foresting practice is to let fires burn and even set them; they happen yearly but no given fire is catastrophic.

What I did gain from the book was more of a sense of history, including some interesting panics. Most particularly, Kindleberger talks about a (fraud-based) mania/panic that happened in gold coins. In his mind that proves that mania and panic are not features of fiat money. In my mind, it is proof that monetary fraud underlies mania and panic.

I also deeply enjoyed the discussion of the connection of fraud with bubbles. Kindleberger can't really explain it; and I doubt he has a mind to. But I can, and do. The explanation is Austrian. Money is created in a fractional reserve system largely by banks, who must lend it out to stay competitive. This is what falsifies the interest rate. Bankers, naturally, want to invest in the soundest, safest investments they can. But the more money they have to invest, the further out they have to go on investment quality. But there is a smooth spectrum of quality connecting an outright fraud to a sound investment. For every sound investment, it is possible to find a slightly less sound one. If one man has a two year track record, another has only one. If one man is completely sure his idea will work, another is just pretty sure. If one man has $10000 in collateral, another has $9000. And so it goes, for every dimension you can imagine. Similarly for fraud: for every fraudulent scheme there is a slightly less fraudulent one. The spectrum meets in the middle. Thus, money creation via bank lending necessarily drives the society further out into the risk spectrum than it "should" be - that it would be without the fraud of fractional reserve. Some of those risks always turn out to be fraud; and thus, frauds inevitably accompany inflationary central bank policy in larger amounts than they would in an honest monetary system. Thus, it is almost always frauds being discovered that sets off a panic.
Live Free or Die - The FSP has voted. It's New Hampshire. Woo-hoo!

Judging from the comments on their forums, a goodly number of them will be moving almost immediately. Others will be waiting for the 20000 membership level; but I have the feeling that is less important than having made the right choice. If Wyoming had been selected, I think a lot of people would be sitting back, waiting to make 20000 before commiting. But there's jobs in NH, so, there's a lot less planning and risk required to move there. There are a lot of libertarian leaning people out there that are not going to feel the need to officially join up with the FSP in order to move to NH. They're just gonna do it. So I don't think it really matters that much if the FSP makes 20k or not. The important thing is, libertarians have collectively made a decision to focus on a state.

Now the work begins.
As a teenager, I used to think about democracy a fair amount. It's a system, I'm a system hacker by nature, so, I thought about ways of running it that would lead to better results. Of course, I ended up rejecting the state as incompatible with morality. And thus democracy doesn't seem so important; I have not given much thought to how to run it well in years. But since I have been lurking over at the FSP boards, practical politics is more in my mind. Thus, some thoughts on how to run a fairer system of democracy.

As I understand it, the idea behind electing representatives is that they represent us - they proxy our votes. My idea is simple: make vote proxying explicit.

There would be no elections, per se. Instead, it would be an ongoing fee-based project of the government to discover proxies for the citizens. There might be special times when the government organizes itself to reach out to the masses to try to get them to reconsider their proxy; and these might seem something like our current elections.

Every citizen would have the right to pick any proxy he or she wished. There would be just two types of proxying allowed: one would allow further proxying (with the proxy choosing), and the other, not. Any proxy with a sufficient number of votes proxied would be allow to sit in, and vote in, the representative body (let's call it Congress, but it might be any legislature type of body). The proxies with the largest number of votes would be allowed into Congress. This might be everyone representing at least 1m voters; or it might be the 400 top proxies.

Voting in Congress would require different voting levels to pass two fundamental types of laws. An "abolition vote" would be any vote to abolish any current law(s) while adding no new law. Abolition votes would require a 50% majority of proxied votes of the assembled, voting, legislators. Thus, people who are not represented in Congress, or whose representative did not show up that day, effectively abstain from all abolition votes. All other voting actions by the Congress would be in the second category, and would require a 50% majority of all registered voters - registered, that is, with any proxy, or with no proxy at all. Thus, people who are not represented in Congress, or whose representative did not show up that day, effectively vote against all ordinary congressional votes.

What's good about this system as versus our current system?

First, under a proxy system it should be easy to get very good representation for almost every voter. Consider a system where the 400 top proxies are allowed in Congress. Perhaps half of these would be "Centrist" representatives comparable to our Demopublican politicians. But the other half would be every imaginable flavor and combination of radical. Basically, every political group down to about the 0.1% level would be represented. If 2% of the public are libertarians, they could proxy to a handful of well known Libertarian politicians.

Second, the representation is much more direct. Changing your proxy is allowed. There would be a fee for the service under any libertarian system, but presumably that would be small. Thus, any politician would be held directly and immediately accountable to the voters. By contrast, in our current system if your representative votes wrongly, you can do literally nothing about it. One can imagine mass campaigns to de-proxy politicians after every major vote. If you think politicians are risk averse now, it isn't anything. This is good - it builds in tremendous resistance to change.

Note that the ability to reproxy also increases the effective representation ability of the system. Let's say you are in some tiny minority so small you have no representative in Congress. You might still get effective representation by switching your proxy at strategic times, based on upcoming votes. Because proxies can "pass on" the proxies (of the voters that allowed that), the fee for strategically reproxying can be spread over the entire group. Thus the group of lesbian pro life black vegetarians, for instance, might proxy to a NARAL representative some of the time, a vegan representative some of the time, The Rev. Jesse J some of the time, and the "Gay Alliance" rep some of the time.

The final improvement over the current system is that this system allows a form of opting-out. If you register, but don't vote, or if you proxy to someone who is not allowed to vote, or who can't or won't go to Congress, then you effectively are against all new law. A minority opting out is still subject to the will of the majority (that's democracy - replacing this aspect of the system would be interesting, but not democratic). But an anti-political minority can, at least, make it harder for the majority to add new law. If one third of the voters are not represented, then it takes a 2/3 supermajority of the represented voters to pass every law; but still only a normal 50% majority to remove laws.

By contrast, in our current system everyone who voted or did not vote is equally considered to be represented by the winner. Most winners get less than a quarter of the electorate to endorse them. And many laws are passed by near votes of about 50% of the representatives. Thus, looked at in terms of proxies, many of our laws really only proxy for about 1/8 of the voters; and few laws if any proxy for more than about 40%. It is no wonder most people feel so estranged from politics - it's because we, collectively, are.

Unreal Economics - An interesting aspect of the effect of deflation on the computation of economic aggregates:
more than half of the second-quarter growth of 3.1 percent was due to defense spending. Another chunk was due to investment in computers, which soared by $38.4 billion. But the vast majority of computer investment never occurred. Given the bizarre way government statistics are compiled, nobody actually paid anything and nobody received anything. That's because Washington measures computer investment by calculating how much it would have cost in 1996 to buy a computer of equivalent power to today's machines. Of the $38.4 billion in the increased computer investment, therefore, only about $6 billion was real spending. The other $32 billion was a statistical construct, which is just a fancy way of saying it wasn't real. Without that false comfort, we would have been looking at a second-quarter growth not of 3.1 percent but of roughly 1.7 percent--and most of that attributable to defense spending.

Eventually foreigners will stop funding our excess. Meanwhile, we trick 'em with shady accounting.
I haven't been into the news, or blogging, much at all this month. It's happened to me before (i.e. last October), and I am sure it will happen again. Just not interested. Perhaps it is post-Iraq letdown. The drip, drip, drip of human blood in Iraq is not very interesting or speedy compared to the flashy war that has led to it.

Meanwhile I have been spending time over at the Free State Project forums. In particular there is a fun argument/discussion on anarchy over there, that I've been pounding words about. I came in about here, and the thread goes on for pages. If you like a nice heated discussion, and you like anarchy, maybe you'll like it.

Meanwhile, if you by some chance are reading this page and have not already found out about the Free State Project - well, what are you waiting for? Liberty in our Lifetime is their motto, and they are probably the best chance libertarians are going to have to make a difference, before the Federal government brings ruin on us all.

Update - that thread got merged. My entry into a now much-longer thread is here. Read onward from that for some sweet old usenet-style back-n-forth. Naturally, nobody is convinced of anything. But we all sure look pretty doing it!
Rule of Dolts - Ah, democracy! Or should we call it ignocracy? Found this at the pollingreport website:
"Which one of the current Supreme Court Justices do you most admire or agree with?" Open-ended question

Sandra Day O’Connor 11
Antonin Scalia 6
Clarence Thomas 5
Ruth Bader Ginsburg 3
Anthony M. Kennedy 2
William H. Rehnquist 2
Stephen G. Breyer 1
David Souter -
John Paul Stevens -
Other names 2
Don't know any names 68
So only 30(±3)% of the American people have the minimal ability to name a Supreme? Argh. Meet the new boss.
Altered Soldiers - an interesting article at Anticipatory Retaliation:
While y'all might wonder about why it is that such a big fuss is being made over better drugs, consider that battle fatigue and its closely related cousin good old-fashioned fatigue can account for the majority of combat ineffective men in a unit that has been continuously engaged in combat for more than a few weeks. In addition to this, if you can get a reliable 24 hours per day out of each soldier, you're getting at least one-third more of combat-effective man-hours per soldier. That means you get 1/3 more out of each meal, each training course and each what ever other support a soldier needs. The equivalent effect in getting rid of the sleep problem and the night-fighting problem is that you go from perhaps 12 combat hours per man per day to 24.
More productivity is a big deal for two classes of soldiers: those with the most extensive/expensive training, and those facing other soldiers. The pilots and the grunts, in other words. It's also nice for other soldiers, but they don't benefit relatively as much - you can just hire more of them to get burst capacity.

Ant doesn't talk about why wakey-drugs will be such a big deal for combat soldier, at least not directly. To understand this more clearly, let's detour into golf for a minute. Remember the recent Sorenstam brouhaha? At the time I linked up Steve Sailor, who used geek methods to predict her performance - perfectly, as it happened. He made the point at the time that golf is not like many sports in that you are not playing the other competitors - you are playing the field. Competitors are then ranked according to how they each do against the field, not each other. So it is relatively easy to analyze courses and players' historical performances on them, and predict how they will do in the future (which is how he predicted Sorenstam's performance). On the other hand, it is much more difficult to predict directly competitive sports. A small increase in ability doesn't necessarily result in a small increase in performance: it may make all the difference. A boxer who gets 2% better doesn't end up winning 2% more rounds and then maybe winning the match because of that. Instead he wins almost all the rounds, or even KOs his opponent early.

With soldiers who are performing abstract missions like flying airplanes unopposed, the right analogy is to golf, track, etc. - you're playing the field. Getting 30% more performance is just that. With combat missions, though, things are different. Being alert on day 2, when your enemy is not, doesn't just mean you take 30% fewer casualties and the enemy 30% more. It means you sneak up on him while he drowses, and you get a slightly bruised hand while he gets his throat cut.
Hulk - saw it. Odd movie. Parts worked, a lot of it didn't really. What was great about it was the special effects, and a lot of the development of the Hulk according to comic-book canon. (Jim Henley has the canon angle covered, so go read that.) Regarding the special effects, not that much can be said beyond "wow!". You have to see them to believe them, and they are thrilling. Watch as the Hulk takes apart tanks and helicopter gunships. Hulk smash!! Bound with the Hulk into near-flight. Wow, that's fun.

What's not fun is all the establishing. Look, my idea of a superhero movie is Spider-man. Bit by a super-spider, bang - superpowers! How is it possible? Who CARES? If you aren't willing to buy the origin, don't see the movie. Or just ignore that and move on. But please - don't waste my valuable movie minutes trying to make plausible what isn't. In the case of Hulk, I feel like an hour was spent with David Banner, then with Bruce, tediously setting up the ridiculous and unbelievable explanation for Bruce's hulkness. Yawn. It would have been no worse, as an explanation, in 5 minutes, and it would save time.

What I do want a movie to do in that first hour is establish the characters. OK, Betty is a babe - fine I'll accept that I should pull for her. But Bruce? Why should I care about him? Is he smart? Nice? Is he courteous? Kind and forgiving? Thoughtful and friendly each day? Warm? Human? What? Don't tell me - show me. Hulk doesn't show me. Hulk doesn't even tell me. So you are left without any real reason to pull for Bruce; clearly he's the protagonist, so you identify a bit anyway. But you want a strong reason, not just the default "I've got to care about someone else why I am here? Might as well do him since he's on screen so much."

The Hulk, when he appears, you can identify with. Everyone would like the freedom and power to SMASH! Puny humans! But here there's a different problem. The Hulk has problems of his own, only imposed ones (mainly the army). Nor is he smart enough to be a full character on his own. He's fun to watch and bounce around with, yes. And that can take a movie a long way. But plotwise he can only serve as a problem for those we really care about - Bruce and Betty. Since Betty's bonifides are basically beauty, you can identify with her. But Bruce is banal. Being the Hulk should be a problem for Bruce, and that's what the movie should be about: his attempts to come to grips with it. First the discovery that the rampages he reads about (and maybe vaguely recalls) are real. Then the discovery of what is causing them (lost temper), and the attempt to control it. Finally the coming to terms with the dangerous alter-ego, and perhaps even use of it. Throughout this process, Bruce should be active, actively looking for information, actively hiding his identity, actively seeking means to control his temper. The antagonists - the army, Dad, even Betty to a degree - should be directly and indirectly limiting his plans, making things hard.

Instead we get Bruce as passive captive for most of the movie. Instead of an action/investigation type plot, we get a mind-numbingly boring psychological plot, where it is gradually, chinese-water-torturingly slowly revealed to us, that, oh no, Bruce had a terrible childhood experience! Well, that was worth two hours of movie. Not. Please: more tank-smashing.

Superheroes need problems; otherwise what's the point? Superman is boring. Spider-man had a myriad of problems: being a teenager; hiding his identity; acting responsibly; the Green Goblin. These all interrelate and make his movie work on more than one level at once. Bruce Banner, in Hulk, has essentially no problem that he had any control over. He is a passive recipient of plot, just having things happen to him until he Hulks out (at which point the movie gets interesting). Eventually he de-hulks and we're back to insipid passivity.

The classic superhero-problem is a supervillian. Well, Hulk has one, sort of. But it just doesn't work; you don't really buy the origin of the villian, and his superpowers are even less believable than the Hulk's. And their final fight seems like an afterthought, though, I suppose it relates to the psychological plot already waded through. Nonetheless it was confusing: who's doing what here, to whom? And so the movie just sort of ends; there's no real climax. You leave feeling vaguely unsatisfied. (The final scene was great, though.)

One more thing. In a movie, I am paying for immersion. I don't want to look at a screen and see a movie on it. I want be in a movie and not know I am looking at a screen. Hulk is full of arty-type screen divisions that are meant, I think, as a nod to the comic-book format of the original. These failed completely for me, each time jarring me out of my media-trance back into the movie theater, looking at a screen. Nice concept, but it just doesn't work.
Owning Little People - outrage:
A legal battle over two home-schooled children exploded into a seven-hour standoff yesterday, when they refused to take a standardized test ordered by the Department of Social Services.

George Nicholas Bryant, 15, and Nyssa Bryant, 13, stood behind their parents, Kim and George, as police and DSS workers attempted to collect the children at 7:45 a.m. DSS demanded that the two complete a test to determine their educational level.

After a court order was issued by Framingham Juvenile Court around 1 p.m., the children were driven by their parents to a Waltham hotel.

Again, they refused to take the test.

"The court order said that the children must be here. It said nothing about taking the test," said George Bryant.

The second refusal came after an emotion-filled morning for the family, when DSS workers sternly demanded the Bryants comply with their orders.

"We have legal custody of the children and we will do with them as we see fit," DSS worker Susan Etscovitz told the Bryants in their Gale Street home. "They are minors and they do what we tell them to do."
Refusing to take a government test is child abuse. Democracy run amuck.
Let's Call the Whole Thing Off - Charles Freund didn't read "Hillary's" book, but
so what?
I've got no time to read the book. Does that matter? I don't see why it should. Hillary didn't actually write her own book, so why should I read it before joining the public chorus about it? Think of me as a ghost-reader.
Human Nature - from the New Scientist:
Take the classic "ultimatum" game. Player 1 is given 10, part of which he has to share with Player 2. He can offer to hand over as much or as little as he likes, and Player 2 can accept what is offered or not. But if Player 2 turns the sum down, neither player gets anything. They play only once, and have no opportunity to get to know one another.

In this situation, Player 2 loses out by turning down any offer, no matter how small. Yet in reality, Player 2 frequently does reject "unfair" offers - on average anything less that 2.59 is rejected and both lose out.

These and a host of similar laboratory games suggest that humans have a strong sense of fairness. They will, for example, punish cheats in more extended games even if doing so leaves them out of pocket. An ultimatum game reported this year in Nature (vol 422, p 137) by Ernst Fehr of the Institute for Empirical Research in Economics in Zurich shows that a desire for fairness extends further. When one player is given powers to fine the other, unfair use of the fine to enforce cooperation can turn out to damage it. On the other hand, cooperation can be enhanced if a player voluntarily refrains from using the fine.

Robert Frank of Cornell University has provided a broader argument that many human emotions are designed to lead people away from pure "calculative rationality". What better way to keep reciprocity going than for it to be known how angry you get if you are cheated? Rage deters cheats, guilt makes cheaters feel bad, compassion produces compassion and loyalty makes people keep agreements. In essence, emotions may be the brain's way of making us do things - keeping our word, refusing to be cheated, cooperating - that will pay off for individuals long-term and stop us being what the economist Amartya Sen calls "rational fools".

Evidence from individuals with brain damage supports this view. One of neurologist Antonio Damasio 's well-known cases was of a man with damage to the prefrontal cortex who appeared to have lost connection to his emotions. In a specially designed gambling game he would inevitably pursue immediate short-term gain, even though it would lead to ultimate loss. The patient never seemed to be able to develop the "gut feel" that told him to steer away from this strategy, and unlike normal people playing the same game successfully he failed to show the galvanic skin responses that indicate emotional arousal.
People are not, morality-wise, blank slates. We have inborn notions of right and wrong.
Meta - I finally decided to change my template in order to put the content on the left. The point of that is faster loading - it often seems to take an extraordinarily long time (in computer years) to load the site counter and the blogger link. I have the feeling that this way will allow you, my dear reader, to read while those things load, or fail to load.

While I was there, I twiddled and added to the blogroll. "Always" blogs are the ones that publish a lot, and which I read a lot. "Occasional" are either publish-sometimes (like Unruled), or I only read sometimes. But they are places that I do visit from time to time, at least, so I really ought to link 'em.

New links in the blogroll: first, the Corner. NRO is often objectionable, but their blog is one of the more fun and readable ones. They natter at each other. They bleg for information from readers (beg + blog = bleg). And even when they are wrong, it is often at least in an interesting way.

I just discovered Anticipatory Retaliation in Jane Galt's comments. Popping over I found an interesting page; check out his analysis of the development of advanced infantry tech. It's very new, though, so on probation - can he keep up the volume?

I have read all of Bill Whittle's (Eject^3) postings since he has started. He is a great essayist. He's also on the wrong side of war and peace; but he has libertarian instincts within the borders so he may be reachable. Meanwhile the essays are worth reading if only as a study of how to write influence pieces.
The Intel War - Jim Henley commenting on the information coming out now about the pre-war intelligence situation:
the leaks from Anglosphere intelligence officials are coming fast and furious these days, in Britain and here. It's dangerous business for politicians to try to set up intelligence agencies as fall guys. Intelligence agencies know things. And they care more about their own political health than yours. Didn't Watergate start to go sour on Nixon when the White House tried to scapegoat the CIA?
There can be clashing institutional interests within the suborgans of the state. Blame assignment is one time when that happens. Nobody wants to take the fall here; in this case the dynamic works towards openness. But in the state openness is hardly usual. Usually the interests of the state agencies are the same, or at least not in opposition to each other.
A Homeland So Secure We Wouldn't Want to Live There - I love the title of this essayby Joseph Stromberg. He explores the dynamic of the modern security state: more surveillance and more war:
...on the received liberal-centrist-conservative (both meso- and neo-conservative) theory, the power of government becomes infinite in wartime. Happily, we get back all of our liberties, such as they are on this theory, the very second the "emergency" is over.

Exposing this theory to the bright light of day, we find that: 1. It is easy to erode and smudge the difference between war and peace. After all, what was the Cold War? 2. Governments have great leeway for finding potential wars in which to be involved. 3. Now we add the axiom that, governments like to wield power and wish like to increase their power. Thus, the conventional theory comes to this:

An institution that has an incentive to find wars and the capacity to find wars is likely to go around finding wars and expanding its powers. If the "war" could be permanent, the bottomless powers would go on forever and the so-called "rights" would never need to be "returned."
Also, an interesting analysis of the state and surveillance. I tend to forget that lots of people don't even theorize the state as an independent organization with its own ends. This is an obvious thing to a libertarian.
Neocon Bedfellows - One of the criticisms libertarians make of "nation building" is a simple observation: if "we" can build an economy over there, why can't we do it right here?

Different people make different conclusions from that. A libertarian knows that we have tried to do it here - and it didn't work. Central planning doesn't work; thus the Iraq occupation is doomed to failure. At least, it's doomed to the degree which they are relying on being able to manage the economy.

On the other hand, socialists take a different conclusion: we can do it there, thus we can do it here. Here's one example: Barbara Ehrenreich lauds the neoconservative fascination with socialism - in Iraq:
almost no one has noticed an even stranger development within the Bush administration– its sudden, and apparently wholehearted, embrace of socialism.

Echoing sentiments expressed in an earlier era by Eugene V. Debs and Woody Guthrie, Colin Powell declared recently, "Iraq's oil belongs to the Iraqi people." There's been no comment yet from Exxon Mobil on the possible application of this principle to the homeland, but Powell's words seemed sincere – unlike those other feel-good phrases the right is always tossing off, like "compassionate conservatism" and "free elections."

In fact, the conservative press is filled with ideas for how to distribute the wealth to the people and keep it out of the hands of "Iraqi elites."

In addition to spreading the oil wealth around, the Bush administration has committed itself to generous public services – though only, so far, in Iraq. Schools will be repaired, damaged infrastructure rebuilt and education made available even to the poorest. There will be quality health care for all. Imagine: A universal health program, of the kind that has eluded Americans for at least half a century, will be created with a snap of the imperial fingers in Iraq.
The removal of Saddam really was a chance to reform Iraq. But the reform that would work - minimal government, minimal democracy, decentralization, strong property rights - is not likely to happen, coming from a bunch of socialists.
Good News from Iraq - I've read several pieces recently with pretty upbeat takes on the situation in Iraq. (For instance, Salam Pax's new column; Mark Steyn's look at western Iraq; this column by Ken Joseph.) I see no reason to doubt these reports. But just below I claim that the situation will not work. What's up with that?

The answer to that is that currently Iraq is, more or less, anarchy. It is evolving up from mere anarchy (completely ungoverned), and now has some vague semblance of governance. It is still anarchic, though: the only state on the ground - the USA - is not in the position to enforce a monopoly of legitimate force. The population do not see the US troops as legitimate; it is clear they are external impositions, even if they are useful and even desired.

As an anarchy, the people have unrivalled liberty. In fact they currently have much more liberty than we do! Iraq is currently a great place to do business. This is one of the things that jumps strongly out at you from the accounts you can read. It is the free market in action, and it is good.

That said, behind the scenes the men of power are moving. With the encouragement of the USA, they will build a government. Then they will have elections of some sort, and socialists will take control. It has happened in every democracy that has ever existed, without fail. Then laws will begin to be passed, many of which will be good laws: laws to stop random crime of property and person. But democracy does not ever stop at a minarchy; oh no. They'll regulate business. They'll tax - states are impotent without expropriation to run their patronage. They'll begin rent-seeking maneuvers to benefit private interests. They'll pass sharia-inspired regulations of all kinds. They'll make all kinds of victimless actions crimes. The freewheeling anarchic Iraq will disappear. People will look back on the brief interlude of liberty as a sort of wild dream.

Led by demogogues of their own chosing, the Iraqi people will eventually revolt and force out the US. They don't really like us. Then the Shi'ites will vote in full Sharia and a theocracy ala Iran. Alternatively, it is possible that a US-favored strongman will arise and effective shut down the democracy. Either way, the result is authoritarian. Probably better than Saddam, that I'll concede. But not, overall, worth the price from our POV.

I just hope that the Kurds can secede and make it stick. This is possible in the first scenario. It would be best for the Iraqi people if the USA carved up the country right now, into autonomous ethnic nations that might have a chance at surviving democracy. But I hardly think that is likely. Any way it goes, it looks to me like the Kurds had better be stockpiling their weapons. Fortunately for them, they are ahead of the rest of Iraq in terms of developing political institutions.
Lies and Damnation - I take my language seriously. I want to always express myself perfectly, the first time. This is, of course, impossible. But I try anyway. One of my little pet catchphrases, when I am tediously belaboring someone else's incorrect expression: "precision in language!". Often followed by "my dear" or "my good man".

With that in mind, a few comments on political language often used online. My biggest pet peeve: "lies". A lie is the use of falsehood, yes. But it is more than mere falsehood: it is the intentional use of falsehood to deceive. In other words you have to know that what you are saying is untrue. Now, it is easy to find people saying things that are not true. But that does not equate to lying - to prove lying, you have to prove more. You must prove what the alleged liar knew when he or she lied. And that is hard to do, since we have no easy access to the insides of each other's heads.

Second peeve: "privilege". A "privilege" is a private law - a law designed to benefit a specific subset of the population, not everyone. People, especially leftists, use "privilege" when they mean "rich".

Third: the ascription of negative motivations, especially hate, to one's political enemies. No, I do not hate the poor. In fact I am for them - that is one reason that I am a libertarian. But just because my politics, if implemented, would be good for the poor, doesn't mean that socialists "hate" or are "against" the poor, even though they are wrong about how to help them. I take it as given that everyone is good willed, unless very explicitly proven otherwise.

And this leads up to "damnation", which Jim Henley says he's gonna write about more soon.

I think Henley's general analysis of the Iraq situation is the same as mine. Iraq is not going to end up a happy clone of Minnesota, or Chile, or even Israel. Rather it will swirl down into, at best, an authoritarian state ala the Shah's Iran, and at worst, an Islamic republic ala Iran in 1980. There is simply no way to have democracy, liberty, and a population of uneducated impoverished Islamic radicals. Pick two (if that).

That said, the preceding is by no means a popular analysis. It relies heavily on the notion that the mass of the people are powerful; and that states cannot shape events freely. Those are radical notions, not shared by the majority. Given that, it is not surprising that a lot of serious people authentically believe that Iraq will work. They are good willed; they just have shallow understanding.

Is it appropriate to damn people of goodwill but shallow understanding? Well, I think doing so is provocative, and might well get some folks to at least consider the idea that the State is not all-powerful. There is an upside. And as I previously stated, speaking in strong terms definitely positions you. Still, I am of the moderate temperment myself. I won't damn people until the evidence is clear that they are wrong; that they are on the wrong side of reality if they continue to propound policy that is hurting people but based on fantasy. I will, of course, continue to maintain my position.

I am also humble. It may be also be that I am wrong. For the sake of the Iraqi people, I hope so.
The Logic of Socialism - Ownership is about the stewardship of things. He who owns a thing is responsible for maintaining it; but he also benefits from it. This is the case for, i.e., capital goods. But it is also the case when the "things" are our selves. In a capitalist society, each person owns himself, and is responsible for his own upkeep. So if a person wants to smoke, or sky-dive, that's his right. In a socialist society, the state owns everyone, and is, therefore, responsible for their collective upkeep. People no longer have a right to do with themselves as they will, because they no longer bear the expense of the consequences.

The NHS in Britain is clearly an instance of socialism. And now they seem to be following the logic of ownership further towards its conclusion: the coercion of people to stop their self-abusing vices.
Overweight people and heavy smokers would have to sign contracts promising to diet or give up cigarettes in return for treatment, under radical new plans being drawn up by Labour. ...

The move comes amid growing concern about the strain on the health service from avoidable illnesses linked to smoking, alcohol, bad diet and workplace stress. For example, Britain suffers a relatively high incidence of heart disease and lung cancer.
What is avoidable? Clearly being fat and smoking are avoidable, at least for some people. But then so are jumping out of airplanes, skiing, eating red meat, and driving to work. Everything we do carries risks; in socialism the state must decide what is too risky and what is acceptable. That is they must decide everything we are permitted to do. This conclusion is repugnant to any right-thinking person.
Vainly Naming - The logic of the Iraq situation is terrible. I've opined on this many times before. It will take nothing less than a Terror to change Iraqi culture. But Americans won't injure, kill, and torture anyone except official combatants. That's all to our credit, but it means we cannot control Iraq.

Jim Henley gets heated thinking about how the situation in Iraq is fraying:
God damn the men who put our troops in this situation. God damn the men who brought our country to this pass. God damn Cheney and Rumsfeld and their cadre of little geniuses. God damn the media poodles who obligingly spun the way they were spun. God damn Colin Powell for the narcissistic lie he told himself about how he was needed "inside the system" when he had the chance to blow it all open by publically resigning. God damn George W. Bush for accepting the advice of knaves and dreamers. God damn Tony Blair and the Third Way messianism that sees war as the engine of human progress, damn the cowardly Democrats in Congress for confusing their short-term political viability with the welfare of the country and damn the freelance cheerleaders, with blogs or syndicated columns, who imagined that their September 11-induced post-traumatic stress disorder was clarity and toughness rather than hysteria. Damn every Annie Hall with a keyboard demanding that Woody Allen come over and kill the spider now, and not just the one in her apartment but every spider on earth, dammit, because someday, someday, one of them just might bite her. God damn every fool who decided to support the war just because the protesters were icky.

Most of all, god damn you if you promise that if we just knock over Iran now, or Syria, or whoever, that all the old lies will come true. God damn your smug, cowardly little souls to hell.
Ouch. That's a lot more heat than seems appropriate this early in the game. On the other hand, if events do spin out of control they way I think they will, Jim will be very well positioned to hand out I-told-you-sos and complementary plates of crow.
Sex Discrimination - One time I talking to a female friend in the gym about my dating situation, and I somewhat flippantly referred to myself as "sexist". She was shocked - to her "sexism" meant, basically, "evil". I had to explain that it was a word with a specific definition, to wit (m-w.com):
1 : prejudice or discrimination based on sex; especially : discrimination against women
2 : behavior, conditions, or attitudes that foster stereotypes of social roles based on sex
I was not interested in dating men; without knowing them or even meeting them once I was ruling them out as possible partners. That is discrimination. Since it is discrimination based on sex, it is sexism. Once I explained that to her, you could see the little lightbulb go on.

Sexism isn't (always) evil. That people think so today indicates more than just a random shift in English usage. It indicates how much of what used to be private is now public.

With that in mind, two minor issues of the day. First up: Annika Sorenstam. There is much handwringing amongst the paleoconservatives about her entry into a "male" tournament. Of course who plays is up to the (private) tournament; everyone agrees on that. Still, isn't there an issue of fairness here? If "we" let her in, don't women's tourneys have to admit men? For example, Fred Reed:
What I don't see is why the club should let women compete against men in the first place. Sure, it sounds like high principle and real fair and American, like Superman. But I notice that all this fairness is one-sided. If men wanted to shoot in ladies' clubs, or play in the women's golf tournaments, every feminist and all her litter-mates would go crazy. Na-a-wwww, that wouldn't be fair.

It seems like women want to compete with the men when they think they can win, but want protection from male competition when they can't, which in sports is usually.
Yes. If we let women join men's tournaments but not vice-versa, it's not fair. But then, neither is it fair for men to have all the testosterone. Life isn't fair. The point in sport is simply to get good competition. As long as we know that one sex or the other is superior in any given sport, then we can, for that sport, have one league with truly open entry, and a second protected league only allowing in the inferior sex. Is that sexist? Yes! But it is no more sexist than having two different sexually segregated leagues. It does require superior knowledge: we need to know which sex is superior wrt that particular sport. But that is hardly difficult to do: set up the open-entry league, then watch for a while and see if women or men cannot compete.

Furthermore, allowing open entry into one league has one huge benefit, from the libertarian (or conservative) angle. And that is, that it allows us to compare the sexes, and thereby maintain a realistic picture of sexual differences. As it happened, Sorenstam's performance in the Colonial was predicable: Steve Sailer predicted it perfectly. But it is one thing to predict, another to do. The only true way to truly know how women and men compare at any given task, is to simply let them do it, and compare them. There is simply no way that you can look at Sorenstam's performance and hold onto the idea that women and men are equal wrt golf-playing. They aren't, and never will be (short of genetic manipulation). Sailer rates Sorenstam, the women's champ, as perhaps the 400th or 500th best golfer in the world (he has no permalinks on his blog it seems; scroll down).

Only with a realistic idea of the comparative strengths and weaknesses of men and women, can we realistically make policy for us all. That "we" have to make policy at all, I reject; but that's not up to me. As long as the state is with us, we need that information.

A good example of need for honest information about sex differences is the issue of women in combat. You find a lot of silly misinformation about what women can do, such as this silly Karen De Coster piece. De Coster argues, among other things, that women and men can't serve together because they are too interested in sex. Given that men are going to be there, then doesn't that mean we should exclude women? No. If it is really a problem, segregate sexes by unit. Perhaps by company or battalion. There is no reason that men and women have to share foxholes to share an army, if that's a practical problem.

Should women be allowed in combat? The answer should be arrived at in the free market; but since we don't have that luxury, we must decide based on political factors. And there the answer must be informed by our liberal values: women are just as much people as men. So of course they must be allowed in combat! But that doesn't mean there cannot be objective criteria to be allowed in; in particular, it may be that for some combat roles very few women will be able to meet the criteria. Very few women can, for instance, carry 100 pound packs for 20 mile hikes. Is that really necessary for an infantry-person? I don't know. Whether or not it is is to some degree simply political. But given that it is, the leg infantry may have to stay mostly or even all male.

Nonetheless, there are many combat jobs that it would seem women could fill very aptly. In particular, it seems women would make great tankers. Small is better in the cramped interior of a vehicle; in fact the USSR used to have height restrictions of 5'5" for its (male) tankers due to the design of their tanks.

Now, I am pretty much against war in all circumstances. But, given that the US is going to act as a hegemonist against all-male armies, I love the idea of an all-female armor battalion annihilating some Arab all-male armor division. Talk about a reality check.