Showing posts with label Philosophy. Show all posts
Showing posts with label Philosophy. Show all posts

Sunday, December 31, 2017

On the Dying of the Darkness

In Chicago, on a summer's night, the sky at 2am glows with a dull grey orange. If modernity has a colour, it is this. The orange is the city, reflected back off the night clouds. The colour of streets illuminated to make it safer to walk in. The colour of houses with merriment and offices with productive work, extending the day long past the sun's descent over the horizon. The colour of man beating back nature. The colour of progress, in its old and apolitical sense of sheer advancement, of doing things that were once not possible.

And yet, few things in this universe are truly free. Wrestling with the full implications of opportunity cost, both in terms of battling it where possible and making peace with it as best you can otherwise, is a large part of the human condition. This concept has been studied by poets and economists alike. As I wrote about in the very first entry of this periodical, the best summary of opportunity cost, in my opinion, still comes from Bob Dylan.

The light dispels the darkness. Even reactionaries, no matter how committed, would hesitate mightily before wishing away this development.

But to choose openly does not mean one cannot regret the tradeoff. So what, thereby, is lost?

Chief among the costs is the splendour of the night sky.

In a capital city in Australia, where I grew up, you can still see the stars at night. Not the full panoply of the Milky Way, but enough to sense the enormity of the heavens.

For immediately conveying the sheer punyness of man on a cosmic scale, there is no substitute for the stars on a cloudless night, surrounded by pitch black. It is a scene which requires almost no explanation. Mere scale is enough to make one's own problems, and indeed one's very existence, seem picayune.

And nothing else quite has the same effect. Not the fury of the ocean in a storm, not the solitude of a silent forest, not the desolation of a wilderness far from other people. A wilderness can be traversed, a forest explored, an ocean sailed. Even when they threaten you, they can all be interacted with. But the stars can only be watched, and one's place in the universe pondered.

And increasingly, we don't see them. I suspect that a child growing up in New York City might go months without seeing the stars. Even as adults, the full visual of the Milky Way has mostly become something we see when on holiday in somewhere remote. Exteranally-prompted contemplation of one's place in the universe becomes similarly irregular.

Modernity is the era of light pollution.

Modernity is also the era of atheism, and (though less remarked), the era of narcissism.

I suspect these aspects are not entirely a coincidence.

Without the stars, one only sees the lights of the city. Without the heavenly panorama, one is less drawn to look at the night sky in the first place. And the same light that drowns out the stars attracts our attention downward, towards televisions, phones and computers.

The stars speak the irrefutable message that there are measures greater than man. Take that away, and man has no measure other than himself and his physical surroundings. The latter is atheism. The former is narcissism.

There are no simple causes of social phenomena, and it would be trite to ascribe great social changes to such Rube Goldberg-like developments as streetlights.

And yet, each restraint that gets eroded adds momentum to the changes already underway.

And this was known long before light pollution was even a concept. As Isaac Asimov noted, quoting Emerson:
If the stars should appear one night in a thousand years, how would men believe and adore, and preserve for many generations the remembrance of the city of God?'

Monday, August 7, 2017

No True Communism

As the estimable Mr Moldbug famously put it, America is a communist country.

This is one of those statements that, on first glance, strikes you as ludicrous. And then you dig a little more, and it seems funny and has something to it, but still seems over the top and wrong. And then you dig a little more, and suddenly you're not so sure any more.

Then one day, you find that 'communism' is a pretty concise explanation for lots of the crazy stuff you see going on around you. And you try to mention this to people, and they look at you like you've wandered off the deep end.

Which perhaps you have - the internet is a wild place.

Then again, communism itself is partly to blame here. It's not like Marx spelled out exactly how his society was going to work in detail, meaning that the label necessarily has a lot more ambiguity than, say, a mercentilist or a right-to-life supporter.

And yet, when someone declares that America is a communist country, it doesn't prompt a mental response of you trying to haggle over exactly what Marx might have meant, and which of the ambiguities of what policies should be classified where in terms of mapping American political thought to a somewhat-light-on-specifics political system.

Not at all. Rather, trying to swallow "America is a communist country" at the first attempt is like trying to drink a tumbler of whisky all in one go. They do it in the movies and look cool. You try it at home, it burns your throat and you throw up.

But among the various ways I've tried to explain this idea to people, here's a surprisingly powerful one.

Consider the following list of policy proposals and aims. It's long, but bear with me.

We'll call this one, Candidate A

-Work to eliminate national oppression, national chauvinism, discrimination and segregation
-Fight against all racist ideologies and practices
-Fight against all manifestations of male supremacy and discrimination against women
-Fight against homophobia and all manifestations of discrimination against gays, lesbians, bisexuals and transgender people
-Implement a $15/hour minimum wage for all workers
-Implement national universal health care
-Oppose privatization of Social Security. 
-Increased taxes on the rich and corporations
-Strong regulation of the financial industry
-Regulation and public ownership of utilities
-Increased federal aid to cities and states
-Opposition to the Iraq War and other military interventions
-Opposition to free trade treaties such as the North American Free Trade Agreement 
-Nuclear disarmament and a reduced military budget
-Campaign finance reform including public financing of campaigns
-Election law reform, including Instant Runoff Voting

Okay, with me so far? Imagining a hypothetical Candidate A?

Now, he's about to square off against his challenger, Candidate B. What policies does he favor?

-Racial justice
-Fight for affordable housing
-Fight for women's rights
-Fight for LGBT equality
-Make college tuition free and debt free
-Get big money out of politics and restore democracy
-Create decent paying jobs
-Implement a $15/hour minimum wage
-Combat climate change to save the planet
-A fair and humane immigration policy
-Work to create an AIDS and HIV-free generation
-Empower tribal nations
-Care for our veterans
-Medicare for all
-Strengthen an expand social security
-Fight to lower prescription drug prices
-Fight for disability rights
-Support historically black colleges and universities
-Reform Wall Street
-War should be the last option
-Real family values
-Improving the rural economy
-Make the wealthy, Wall Street and large corporations pay their fair share

So John Q. Normie looks at that list, and thinks: well, look, the first guy seems to push things a bit further on nationalising healthcare, but then again the second guy wants medicare for all, which seems like basically the same thing. The second guy talks a little more about veterans and the family, but it's hard to know what exactly that means. In terms of policies where they differ, the first guy wants nuclear disarmament and the second guy wants free college, but is this because they sound like they'd vehemently disagree with each other over this, or just that they didn't think of the other one's talking point first? The first guy somehow sounds more angry than the second, even though they both talk a lot about fighting. Perhaps it's just the spin doctoring that the second guy is fighting for stuff, and the first is fighting against stuff. Do I want the friendly guy, or the passionately fired up guy? Geez, I don't know who to pull the lever for. Does it really make a difference?

Enough suspense. Let me reveal the identities of our two candidates.

Candidate B is Bernie Sanders, taken from his issues page

Candidate A is the Communist Party of the USA, taken from Wikipedia's summary of their ideology. If you don't trust them, you can get it straight from the source too.

Actually, I cheated ever so slightly, by leaving out the one aim in the opening sentence from the wikipedia entry that does sound like classical communism
Struggle for the unity of the working class 
That might have set off your radar. But the rest of the stuff is how they plan to struggle for the unity of the working class.

The obvious point here is that it is pretty damn hard to distinguish the two lists. You could use this to simply say "Ah ha! QED, Bernie Sanders is a communist!".

While true, that's not the interesting part here.

The first interesting part here is that the vast majority of Americans, and the vast majority of Bernie Sanders supporters, do not consider Sanders' policies to be examples of communism. They just consider them as examples of slightly left of center Democratic Party politics. In fact, if you accused the average Bernie Sanders supporter of being a communist, they would likely either scoff, or get offended, or both.

And yet here we are. The Communist Party of the USA is claiming pretty much the same list as their policies.

If you're someone who thinks America is not a communist country, this is quite a conundrum.

The answer which I suspect most of the aforementioned group will instinctively choose, is to say that the CPUSA is wrong. We've learned about communism, it's only about central control of the means of production. The rest of it shouldn't be there.

To which I respond: be careful before you go down that path. Are you really saying that the Communist Party of the USA is insufficiently communist? Are you saying you know better than the Communist Party of the USA what actually constitutes communism? These guys have a pretty long and storied history going back to 1919. They walked the walk when it comes to supporting the Soviet Union when it was still in business. Hell, they're still shilling for Madura in Venezuela right now, even as the whole country is starving to death. They seem pretty darn serious to me.

And they say that communism looks a lot like Bernie Sanders. They too support democracy. They too call themselves socialist.

But there's a second thing to note.

The CPUSA is not exactly looking to take over the mainstream, remember. That's why they insist on calling themselves not just communist, but Communist. They're aiming at the fringe left. Even Wikipedia, hardly a bastion of reactionary thought, labels them as "Far Left".

The point is, presumably they'd like to distinguish themselves from the leftist wing of the Democratic Party, otherwise why bother? Why go to all the hassle of getting ridiculed as a Communist and then just end up agreeing with the Democrats?

There are two leading hypotheses here.

The standard one is that this is all subterfuge. They really do care entirely about the single issue they're not trumpeting, namely seizing the means of production, and the rest is entirely bogus and a hook to get people in the door.

Perhaps. In that case, you'd probably conclude they're rather dense, if their "hook" is that if you join you'll agree with the Democrats on everything but face widespread mockery from your friends and family.

The alternative one is that they genuinely have difficulty distinguishing themselves from the Democrats. They've just done what Moldbug joking referred to in his post: for "workers and peasants", read "Blacks and Hispanics". As I wrote about a while back, the story of the latter half of the 20th century is that cultural marxism beat out economic marxism. They've just moved slightly with the times, but other than that don't see a big contradiction.

Not that they couldn't emphasize more the seizing the means of production. Admittedly they're already seizing the utilities, but they could talk about other stuff too.

No, the problem is that when you want them to flesh out the rest of their program, after the means of production are seized, that's when it becomes extremely difficult to distinguish them from the Democratic Party. The means of production are seized! We control the commanding heights of the economy! What else would we like to get done?

The answer, apparently, is Bernie Sanders.

And why is that?

At the bottom of the rabbit hole lies one answer: because America is a communist country.

The pill is large though, and your gag reflex is strong. It can't be. There must be some other answer.

Read on, or read it again, and ponder.

Thursday, February 16, 2017

Carlyle Considered

After a shameful delay, at last I have joined the Froude Society! Previous installments covered Froude's "The Bow of Ulysses: The English in the West Indies" and Maine's "Popular Government". Today's subject is Thomas Carlyle, the grand old man of reaction, and his "Latter-day Pamphlets".

Reading Carlyle is often quite surprising, because while he is indubitably reactionary, it's not always in ways that one might expect. For instance, Carlyle places a lot of emphasis on the great men theory of both history and government.
Indisputably enough the meaning of all reform-movement, electing and electioneering, of popular agitation, parliamentary eloquence, and all political effort whatsoever, is that you may get the ten Ablest Men in England put to preside over your ten principal departments of affairs.
This emphasis means that there is relatively less discussion of detailed policy positions on particular issues of the day. Good government, to Carlyle, is a long way from a set of conservative talking points. It arises by appointing the most competent men to power, and giving them the authority to actually rule.

Carlyle wants, in other words, an aristocracy. But this is an aristocracy of talent and character, not one of inherited class. Men of low birth but noble character are singled out for praise, Robert Burns being a prominent example.
Choose well your Governor;—not from this or that poor section of the Aristocracy, military, naval, or redtapist; wherever there are born kings of men, you had better seek them out, and breed them to this work. All sections of the British Population will be open to you.
To the modern mind, one is more apt to evaluate governments by whether they their preferences accord with our own (and hence whether we want the same things implemented as the leaders do ) and whether they have the competence to actually carry the plans out. In this reckoning, a competent leader carrying out plans we hate is considerably worse than an incompetent leader trying and failing to carry out plans we hate.

But to Carlyle, competence involves the ability to understand the decrees of Nature or Nature's God, and thus know what will cause justice to be done. As a result, the distinction between competent government and just government is not of primary significance:
To prosper in this world, to gain felicity, victory and improvement, either for a man or a nation, there is but one thing requisite, That the man or nation can discern what the true regulations of the Universe are in regard to him and his pursuit, and can faithfully and steadfastly follow these. These will lead him to victory; whoever it may be that sets him in the way of these, —were it Russian Autocrat, Chartist Parliament, Grand Lama, Force of Public Opinion, Archbishop of Canterbury, M'Croudy the Seraphic Doctor with his Last-evangel of Political Economy,—sets him in the sure way to please the Author of this Universe, and is his friend of friends. And again, whoever does the contrary is, for a like reason, his enemy of enemies. This may be taken as fixed.
Perhaps the reason that we no longer talk this way is that most of us no longer believe in God (or anything else), and hence don't think of the aim of politics as being to implement his justice on earth. As a result, there's just preferences.

The above quote also illustrates that the focus on competent leaders making competent decisions takes precedence over designing mechanical schemes to implement decisions. As I noted in the discussion of Maine, early Moldbug (in the form of ideas like neocameralism) is a scientist of government, seeking the truth of optimal arrangements. Maine is an engineer of government, grappling with the messy practicalities of what produces generally stable outcomes. But in this taxonomy, Carlyle is an artist of government. Governing is a skill to be learned by able men, appropriately apprenticed to their trade. The only interest in systems and mechanisms is in the extent to which they correctly select the right men, and elevate them to power.

For this reason, Carlyle is generally scathing about the modern implementation of democracy, but not because it is impossible to implement well. The main problem is the fact that the world is full of fools, most of whom know nothing about either government policy or selecting able men. The Laws of the Universe are not easily given up to every Tom, Dick and Harry, so averaging out their opinion with those of the wise is a recipe for disaster:
Your ship cannot double Cape Horn by its excellent plans of voting. The ship may vote this and that, above decks and below, in the most harmonious exquisitely constitutional manner: the ship, to get round Cape Horn, will find a set of conditions already voted for, and fixed with adamantine rigour by the ancient Elemental Powers, who are entirely careless how you vote. If you can, by voting or without voting, ascertain these conditions, and valiantly conform to them, you will get round the Cape: if you cannot,—the ruffian Winds will blow you ever back again; the inexorable Icebergs, dumb privy-councillors from Chaos, will nudge you with most chaotic 'admonition'; you will be flung half-frozen on the Patagonian cliffs, or admonished into shivers by your iceberg councillors, and sent sheer down to Davy Jones, and will never get round Cape Horn at all!
...
Ships accordingly do not use the ballot-box at all; and they reject the Phantasm species of Captains: one wishes much some other Entities,—since all entities lie under the same rigorous set of laws,—could be brought to show as much wisdom, and sense at least of self-preservation, the first command of Nature.
For democracy skeptics like me, there is much to enjoy. But Carlyle is not easily reduced to slogans, and gives a quite nuanced view on when voting will work better or worse. Latter Day Pamphlets is not wedded to a particular governing system.

For instance, the biggest surprise of the book was that Carlyle is relatively positive about Oliver Cromwell. To me, I had always thought of Cromwell as a disaster, the beginning of where things went badly wrong in English history, and the destruction of genuine monarchy in England. But this isn't how Carlyle portrays it. Cromwell's strong Christian belief is implicitly praised, as is competence in leadership. Remember, the key is greatness of leadership, not forms of government! In this respect, I part company with Carlyle in the importance of institutions and norms. Even if Cromwell were more competent than Charles I, the successor to Charles I would have been a much better bet than the successor to Cromwell. Institutions are not an idea that has much prominence in Latter-day Pamphlets, and the subject of Cromwell and Charles I is not covered in enough detail for me to fully understand the appeal or the implied argument, But the overarching point is still correct - having a crown does not make one a real king, and fake kings are a source of particular disgust to Carlyle. While he does not elaborate much on Charles I, he accurately predicts that constitutional monarchs will not be stable arrangement, nor should we wish them to be:
Imposture, be it known then,—known it must and shall be,—is hateful, unendurable to God and man. Let it understand this everywhere; and swiftly make ready for departure, wherever it yet lingers; and let it learn never to return, if possible!
...
The Kings were Sham-Kings, playacting as at Drury Lane;—and what were the people withal that took them for real? It is probably the hugest disclosure of falsity in human things that was ever at one time made.
...[The Common Englishman] has been used to decent forms long since fallen empty of meaning, to plausible modes, solemnities grown ceremonial,—what you in your iconoclast humour call shams,—all his life long; never heard that there was any harm in them, that there was any getting-on without them. Did not cotton spin itself, beef grow, and groceries and spiceries come in from the East and the West, quite comfortably by the side of shams? Kings reigned, what they were pleased to call reigning; lawyers pleaded, bishops preached, and honourable members perorated; and to crown the whole, as if it were all real and no sham there, did not scrip continue saleable, and the banker pay in bullion, or paper with a metallic basis ?"
Carlyle predicts, in other words, what I have mentioned before - that political arrangements which are no longer actively defended, which persist out of institutional habit and inertia, will not survive. The unprincipled exceptions, if not actively insisted on, will be made into principled disasters. My guess as to the big elephant in the room on this front is citizenship. With Politics as with life -  nature has made up her mind that what cannot defend itself shall not be defended, as Mr Emerson put it.

By contrast, Oliver Cromwell and the members of the Long Parliament were deadly serious. And Carlyle gives an outstanding Chesterton's Fence justification of what role Parliament actually used to fill (much better than my own poor efforts)

Reading in Eadmerus and the dim old Books, one finds gradually that the Parliament was at first a most simple Assemblage, quite cognate to the situation; that Red William, or whoever had taken on him the terrible task of being King in England, was wont to invite, oftenest about Christmas time, his subordinate Kinglets, Barons as he called them, to give him the pleasure of their company for a week or two: there, in earnest conference all morning, in freer talk over Christmas cheer all evening, in some big royal Hall of Westminster, Winchester, or wherever it might be, with log-fires, huge rounds of roast and boiled, not lacking malmsey and other generous liquor, they took counsel concerning the arduous matters of the kingdom.
...So likewise in the time of the Edwards, when Parliament gradually split itself into Two Houses; and Borough Members and Knights of the Shire were summoned up to answer, Whether they could stand such and such an impost? and took upon them to answer, "Yes, your Majesty; but we have such and such grievances greatly in need of redress first,"—nothing could be more natural and human than such a Parliament still was.
...For, in fine, the tragic experience is dimly but irrepressibly forcing itself on all the world, that our British Parliament does not shine as Sovereign Ruler of the British Nation; that it was excellent only as Adviser of the Sovereign Ruler; and has not, somehow or other, the art of getting work done
In the Carlyle telling, the Parliament worked for two reasons. Firstly, it was composed of men who were themselves Nobles and Rulers, and thus competent to advise on such matters. And secondly, it filled the role of discussing policy choices when there were few avenues available for this. As Carlyle notes, this task is much more competently carried out in modern times (both his and ours) in the press. But the presence of the press makes Parliament not only superfluous, but contemptible, as it turns Parliamentary speeches into performances marketed to the rubes, not serious policy debates. Parliaments, at best, make good advisers but bad sovereigns. Modern parliaments are bad at both. 

There are some parts of Latter Day Pamphlets, especially those that describe the actual workings of government, that read as eerily prophetic. One is forced to do a double-take when one reads the descriptions of how government in England actually worked at the time. For instance:

[I]t is felt that 'reform' in that Downing-Street department of affairs is precisely the reform which were worth all others; that those administrative establishments in Downing Street are really the Government of this huge ungoverned Empire
Much has been done in the way of reforming Parliament in late years; but that of itself seems to avail nothing, or almost less. The men that sit in Downing Street, governing us, are not abler men since the Reform Bill than were those before it.
The civil service, in the form of the Home Office, Foreign Office and Colonial Office was already thoroughly in charge of governing...in 1850. Not only that, but the civil service was also fast turning into a sclerotic mess of incompetent bureaucrats badly doing work that didn't really need to be done in the first place. Pause and let that sink in when you hear conservatives talking about how we need to scale back the size of bureaucracy. 

As a consequence, it doesn't matter much who is the Prime Minister, since the civil service makes all the important decisions anyway, and the election and political process is so chaotic and time-consuming that there isn't scope for much else for a leader to do. This is a point that Moldbug emphasises a lot, but the average democracy adherent simply cannot believe. The memorable description of being Prime Minister is that of trying to stay atop a wild bucking horse, with the effort towards not being thrown off crowding out any hope of controlling the direction:
[T]he Right Honourable Zero is to be the man. That we firmly settle; Zero, all shivering with rapture and with terror, mounts into the high saddle; cramps himself on, with knees, heels, hands and feet; and the horse gallops—whither it lists. That the Right Honourable Zero should attempt controlling the horse—Alas, alas, he, sticking on with beak and claws, is too happy if the horse will only gallop anywhither, and not throw him. ... This is what we call a Government in England, for nearly two centuries now.
...Really it is unimportant which of them ride it. Going upon past experience long continued now, I should say with brevity, "Either of them—Neither of them." If our Government is to be a No-Government, what is the matter who administers it? Fling an orange-skin into St. James's Street; let the man it hits be your man.
This has been the government ... for nearly two centuries before 1850.  If you think Carlyle might be right, rolling things back to the 1950's isn't going to cut it.

Yet despite these similarities in description of some parts of the world, one sees that Moldbug's description of Carlyle as a reactionary is entirely correct:
A reactionary is not a Republican, a Democrat, or even a libertarian. It is not even a communist, a fascist, or a monarchist. It is something much older, stranger, and more powerful. But if you can describe it as anything, you can describe it as the pure opposite of progressivism. True reaction is long since extinct in the wild, but it lives in Carlyle.
Indeed, reading through Latter Day Pamphlets, one continues to be struck by statements that defy description on the standard modern political spectrum. Authority is not only necessary, but wise and just:
I say, it is the everlasting privilege of the foolish to be governed by the wise
Carve it in stone. This is so far outside the Overton Window that we barely have words to describe it.

But if you were hoping for a defense of mainstream capitalist economics, you will not find it here. Carlyle is shocked and appalled by the level of poverty evident in Ireland. But unlike the left, he is appalled not only because of the suffering, but mostly because the indigence and misery is a sign of a catastrophic failure of governance. The problem with poverty is not ultimately the money, but the wasted lives.
The Idle Workhouse, now about to burst of overfilling, what is it but the scandalous poison-tank of drainage from the universal Stygian quagmire of our affairs? Workhouse Paupers; immortal sons of Adam rotted into that scandalous condition, subter-slavish, demanding that you would make slaves of them as an unattainable blessing! My friends, I perceive the quagmire must be drained, or we cannot live.
...
If our Chancellor of the Exchequer had a Fortunatus' purse, and miraculous sacks of Indian meal that would stand scooping from forever,—I say, even on these terms Pauperism could not be endured; and it would vitally concern all British Citizens to abate Pauperism, and never rest till they had ended it again. Pauperism is the general leakage through every joint of the ship that is rotten. 
Carlyle is decidedly cool on the ability of markets, not only to solve these problems, but also to generate wise decisions in general. His scathing essay on the possibility of making a statue of railway baron George Hudson, who is presented as a seller of worthless scrip and dubious economic schemes, makes clear why. A democracy of dollars is not much more likely to recognise genuine human worth than a democracy of votes, for much the same reasons. This is not a matter Carlyle takes lightly:
If the world were not properly anarchic, this question 'Who shall have a Statue?' would be one of the greatest and most solemn for it. Who is to have a Statue? means, Whom shall we consecrate and set apart as one of our sacred men?
And he walked the walk too, founding the National Portrait Gallery to make sure that great men were properly commemorated too. 

One is also reminded in odd ways that the world itself was very different in 1850, and not just in the ways that get frequently remarked on. For instance, in an essay discussing the enormous prominence given to people who had the gift of good speech, Carlyle states the following:
Our English careers to born genius are twofold. There is the silent or unlearned career of the Industrialisms, which are very many among us ; and there is the articulate or learned career of the three professions, Medicine, Law (under which we may include Politics), and the Church. Your born genius, therefore, will first have to ask himself, Whether he can hold his tongue or cannot ?
Two questions arise, both linked. Firstly, what criteria do we now use to evaluate truth, apart from rhetoric, which gets little discussion in the essay? And secondly, what is the large class of learned careers not discussed in the above list?

The answer to both is: science. One can see that the intellectual impact of the scientific method had not yet permeated much of society, and that science itself was practiced by a small number of mostly independently wealthy people like Lord Kelvin. The rest of innovation was merely lumped in with industrialism, and not at all considered to be an important or primary method of understanding the universe. If you were actually transported back to the world of 1850, it would almost certainly strike you as utterly alien in far more ways than you imagine. As Moldbug said of Larry Auster, it is equally true of Carlyle - he is gone, and so is the country he was born in. To complain of either would be as superfluous.

But the underlying truth of his words still remains. To those of us skeptical about modernity, Carlyle speaks across the ages, addressing our misgivings and pointing a way forward through the morass:
My friends, across these fogs of murky twaddle and philanthropism, in spite of sad decadent 'world-trees,' with their rookeries of foul creatures,—the silent stars, and all the eternal luminaries of the world, shine even now to him that has an eye. In this day as in all days, around and in every man, are voices from the gods, imperative to all, if obeyed by even none, which say audibly, "Arise, thou son of Adam, son of Time; make this thing more divine, and that thing,—and thyself, of all things; and work, and sleep not; for the Night cometh, wherein no man can work!" He that has an ear may still hear.
Just so.

Wednesday, November 11, 2015

The Financier's Roar

Finance is not generally considered a stirring subject. Interesting, maybe. Remunerative, certainly. Complicated, definitely (and don't believe anyone who says otherwise). But stirring?

Well, not often, but occasionally.

2001 was not a great year for Berkshire Hathaway. The firm had experienced its first decline in book value per share (their chosen measure of performance) in their history. This was coming off the back of a very poor 1999 result where their growth in book value per share underperformed the S&P 500 by 20.5%. In 2001, at least everyone else did poorly too, but to a firm that prided itself on consistent results, this was a tough pill to swallow.

The proximate cause of this problem was that they run a huge reinsurance business, and September 11th caused them to have to pay out a ton. And Warren Buffet, in his 2001 letter to shareholders, had the job of fronting up to investors about what was going on.

He began by explaining what he called the three principles of underwriting, which he acknowledged that they had failed to live up to:
1. They accept only those risks that they are able to properly evaluate (staying within their circle of competence) and that, after they have evaluated all relevant factors including remote loss scenarios, carry the expectancy of profit. These insurers ignore market-share considerations and are sanguine about losing business to competitors that are offering foolish prices or policy conditions.
2. They limit the business they accept in a manner that guarantees they will suffer no aggregation of losses from a single event or from related events that will threaten their solvency. They ceaselessly search for possible correlation among seemingly-unrelated risks.

3. They avoid business involving moral risk: No matter what the rate, trying to write good contracts with bad people doesn’t work. While most policyholders and clients are honorable and ethical, doing business with the few exceptions is usually expensive, sometimes extraordinarily so.
The third one I'm less certain of than the first two. But they all fit a pattern - pick carefully which risks you want to take on. Make sure you can survive them, and pick the ones likely to be profitable.

But having done that, how should one approach the vicissitudes of fortune? How should one weather the storm?

Buffet's answer is perhaps my favourite line in finance. I call it 'The Financier's Roar'.
At Berkshire, we retain our risks and depend on no one.
Just so.

Risk and return are not just academic constructs, but the very stuff on which the economic world is built. The point is not to eliminate risks. If one wants to do that, buy treasury bills, accept a zero rate of return, and don't ever leave your house. You will earn zero, and you will never succeed.

The vast majority of good plans carry a risk of failure. The reason they do is that arbitrage is rare. Sometimes, life hands you a risk-free profit opportunity, but, like the proverbial $20 bill on the sidewalk, they don't stick around for long. And in the space of risky ventures, a similar mechanism holds. If an opportunity has a really high return and very low risk and everyone sees this, mostly the price will get bid up until the expected return has gone back down.

Mostly. But not always. Arbitrage may be very rare, but undervalued assets are more common. Figuring out what they are is the substantive part of the Buffet risk management. Identify things that are good risks, and buying enough that you can take on and survive.

The second part, the Financier's Roar, is the call to courageous decisions. Having selected the right risks to take on, retain them. Be willing to eat the possibility of loss and failure, and don't try to hedge everything out. Have the confidence of your own calculations to hold the portfolio of life's payoffs that you think will work out the best overall. As I have noted before, one does not eat the expectation, but the realisation. No matter how well you calculate, sometimes you will lose. That's life. But at least you won't lose in a stupid manner. Courage, when properly applied, is taking the right risks, though risks they be nonetheless.

The second benefit is the one that's easy to overlook, but is important. When one retains one's risks, one is an island. The universe may deliver success or failure, but the only thing that matters is one's calculations and the roll of the dice. By contrast, the more you hedge out risks by trading with others, the more you rely on the success or failure of others. If you're relying on a counterparty to pay up when the porridge hits the propeller, your risk management now depends on their risk management. Just ask the people who bought credit protection from Lehman Brothers.

Retaining risks leads to self-reliance. Retaining the right risks leads to success or failure with the only tools one has against the cold indifference of fate - one's own wits.

Retain your risks, and depend on no one.

Wednesday, September 10, 2014

The limits of expected utility

It is probably not a surprise to most readers of this august periodical to find out that I yield to few people in my appreciation for economic reasoning. Mostly, the alternative to economic reasoning is shonky, shoddy intuitions about the world that make people worse off. Shut up and multiply is nearly always good advice - work out the optimal answer, not what makes you feel good. The alternative is, disturbingly often, more people dying or suffering just so you can feel good about a policy.

But perhaps it may be a surprise to find that I not infrequently end up in arguments with economists about the limits of economic reasoning in personal and ethical situations. There is often a tendency to confuse the 'is' and the 'ought'. We model people as maximising expected utility, usually over simple things like consumption or wealth, because these are powerful tools to help us predict what people will do on a large scale. But for the question of what one ought to do, it is particularly useless to do what some economists do and say, 'Well, I do whatever maximises my utility'. No kidding! So how does that help you decide what's in your utility function? Does it include altruism? If so, to whom and how much? Do you even know? A lot of ethical dilemmas in life come from not knowing how to act, which (if you want to reduce everything to utility terms) you could say is equivalent to not knowing how much utility or disutility something will give you. There's ways to find that out, of course, but those ways mostly aren't economics.

More importantly, this argument tends to sneak in a couple of assumptions that, when brought to the fore, are not nearly as obvious as the economics advice makes them.

Firstly, it's not clear that utility functions are fixed and immutable. This is perhaps less pressing when modeling monopolistic competition among firms, but is probably more first order in one's own life. Could you change your preferences over time so that you eventually got more joy out of helping other people, versus only helping yourself? And if so, should you? It's hard to say. You could think about having a meta-utility function - utility over different forms of utility. For the same amount of pleasure, I'd rather get pleasure from virtue than vice. This isn't in most models, although it probably could be included in some behavioral version of stuff (I suspect it may all just simplify to another utility function in the end). But even to do this requires a set of ethics about what you ought to be doing - you need to specify what behavior is utility-generating behaviour is admirable and what isn't. Philosophers have debated what those ethics should be for a long time, but you'll need to look outside economics to find what they are.

Mostly, people just assume that whatever they like now is good enough. Of course, they're assuming their desires don't raise any particular ethical dilemmas. You can always think about extreme cases, like if someone gains utility over torturing people. Most die-hard economists would probably still not give the torturer the advice to just do what gives them utility. They'd try to find wiggle ways out by saying that they'd get caught, but that just punts the question further down the road - if they won't get caught, does that mean they should do it? You'd probably say either a) try to learn to get a different utility function that gets joy from other things (but what if they can't?), or if they're more honest b) your utility isn't everything - some form of deontology applies, and you just shouldn't torture people for fun simply because you find it enjoyable.

Of course, if you admit that deontology applies, some things are just wrong. It doesn't matter if the total disutility from 3^^^3 dust specks getting in people's eyes is greater, you'd still rather avoid torture. Eliezer Yudkowsky implies that the answer to that question is obvious. How many economists would agree? Fewer than you'd think. I'm probably not among them either, although I don't trust my intuitions here.

But fine, let's leave the hypotheticals to one side, and consider something very simple - should you call your parents more often than you do? For most young people, I'd say the answer is yes, even if you don't enjoy it that much. Partly, it's something you should endeavour to learn to enjoy. Even if this doesn't include enjoying all of the conversation, at least try to enjoy the part of being generous with one's time. Though the bigger argument is ultimately deontological - children have enormous moral obligations to their parents, and the duties of a child in the modern age include continuing to be a support for one's parents, even if you might rather be playing X-Box. If you ask me to reason this from more basic first principles, I will admit there aren't many to offer. Either one accepts the concept of duties or one doesn't.

In the end, one does one's duty not always because one enjoys it, but simply because it is duty. Finding ways to make duty pleasurable for all concerned is enormously important, and will make you more likely to carry it out, but in the end this isn't the only thing at stake. There is more to human life than your own utility, even your utility including preferences for altruism. It would be wonderful if you can do good as a part of maximising your expected utility. Failing that, it would be good to learn to get utility from doing good, perhaps by habit, even if that's not currently in your utility function. Failing that, do good anyway, simply because you ought to.

Monday, June 9, 2014

The minimum requirements for serious conversation

In real life (certainly in this country, though not nearly as much in Australia), I've sometimes been accused of having no filter on what I say. This isn't true, of course, but the extent of my sociological observations goes farther than most people here. America is a country where it is crucially important not to notice things, as Steve Sailer put it. If you notice, you absolutely shouldn't comment. If you comment, you really truly ruly shouldn't dare find any of it funny or ironic, or indeed anything other than deadly serious.

How tiresome.

But these are serious times, and joking with the world at large about the wrong things does not tend to get rewarded. One must pick one's audience, so to speak. This blog, for instance, is not that audience. Everything said here is said to everyone, for all time, and able to be quoted out of context and misconstrued for years to come.

But it is oppressive to never speak one's mind freely. Paul Graham recommended drawing a wall between one's thoughts and one's speech, the former being free, the latter being restricted for what is acceptable.

I dance a finer line. With people whose character I feel I can trust, I'll say what I think. Sometimes they're surprised, because this assessment isn't actually that correlated with how long I've known a person. Some people I know and consider dear friends never fall into this category. Some people I've known I a day or two do. Those, I think, are the ones who sometimes think I have no filter.

So what determines whether I think it's likely to be worthwhile to speak freely to someone or not?

As far as I can tell, there are three main classes of requirement.

The first is that you know, without me needing to explain it to you, in a deep and instinctive sense, the difference between the following words:
All
Most
The Average
The Median
The Modal
Some
A Few
Causes
Is Correlated with

The statement 'all Australians are obnoxious' is very different from 'the average Australian is obnoxious'. People that don't get this will transform the latter into the former, and thus read it as 'he is accusing me of being obnoxious because I am Australian'. Conversation with people who think like this is always a minefield, so it's better to stick to small-talk.

Related to the above, understanding basic causal inference is equally important. Umbrellas are correlated with traffic accidents but do not cause traffic accidents - rain causes both. Prisons affect crime and crime affects prisons - prisons fill up when crime increases, and the increase in prison populations reduces crime.

You don't need to use words like 'omitted variables' and 'simultaneity', but you do need to have a good feel for these different types of models of the world, and be able to think about how they might apply to some new situation.

These requirements mean that your words aren't apt to be misconstrued. If you happen to get lazy and utter something like 'Australians are obnoxious' rather than specifying a precise probabilistic and causal statement, the person will not immediately assume the most inflammatory possible interpretation.

The second requirement is that you consider truth a near-complete defense to any charges levelled against pure statements about the nature of the world (as opposed to statements of opinion). If the average Australian is indeed obnoxious, one should be free to say so. You do not change the territory by yelling at the world's cartographers. It is possible that Australians will become less obnoxious if we all agree to stop discussing the fact of their obnoxious behaviour. But I would not bet on it. If in doubt, truth should be a sufficient justification for any statement purporting to claim a fact about the world in general or a model of causality in the world.

There are limiting cases where some statements might be irresponsible, like spreading information on how to make nuclear weapons from household items. In my estimation, those are pretty rare, however (actually, your view on how many statements ought be ruled as impermissible based on responsibility criteria is another way of phrasing the second requirement - you probably need a low filter here). There are also basic questions of politeness when it comes to not making unhelpful statements about a single person, particularly when made to that person. All of that applies. But outside of such personal interactions, there ought to be a strong presumption that truth is a sufficient justification for any statement.

This stops every argument descending into accusations about motives. The earth rotates around the sun, regardless of whether Galileo is saying so because of a devotion to scientific truth as he perceives it, or because Galileo is a contrarian rabble-rouser who likes to intellectually stick a finger in people's eyes, or because Galileo is intellectually committed to bringing down the Catholic Church. Truth is truth.

The third is that you don't take disagreement personally. If you think X, and someone else thinks Y, and X and Y are merely statements about how the world is, then we should be able to discuss this without the fact of my disagreeing with you causing you to get angry. If disagreement alone is enough to get you pissed off, then any discussion is a joint balancing of the strength and veracity of an argument, with my estimate of your current mood and the likely impact of the next statement on said mood. Such discussions tend to get exhausting very quickly for me. If disagreement, even about cherished beliefs, is not a source of anger, then we can talk about things.

Of course, you never quite know at first whether these requirements are going to be met. You try to feel people out about them.

But my experience is that with people who fit in these categories, I don't actually need any particular filter on what I say, although sometimes my remarks sound outlandish given popular sentiments. Usually, such people have a sense of humor about jokes on whatever the subject is too. They are worthy conversation partners.

In any case, if I do speak to you frankly, it is a mark of esteem, that I think you fit into all of the categories above.


Sunday, March 30, 2014

Every clod that the sea washes away makes Europe the less

Some days the world is tragic in ways that don't leave you with much left to say.

Via Athenios comes this story from Greece:
An investigation was launched on Friday into the circumstances surrounding the death of Ilie Kareli, the 42-year-old Albanian inmate who killed a prison guard on Tuesday, after he was found dead in a prison cell and a coroner’s report indicated that he had suffered serious injuries after being beaten with a blunt instrument.
So far, so ordinary. We see so much misery in the news that it's easy to get desensitised to it. A kills B, B's friends retaliate and kill A. It's a story as old as man. Unfortunate, but the guy had it coming, says the voice that reads this kind of thing every single day.

And yet, every now and then some small humanising detail will creep in and pierce the studied cynicism that all experienced newspaper readers have. It will remind you that everyone in this story is somebody's son, somebody's brother, and that the tragedy is neither an abstraction nor a morality play.

In my case, it was the following:
The medical examiners said he had been beaten up to three days before his death.
Guards at Nigrita prison said they had noticed Kareli’s bruises when he arrived at the facility. They said he declined to be seen by a doctor and instead asked for “some rope to hang myself.”
I have found those lines going around and around in my head ever since.

It is hard to bear too much of the world.

One must take consolation where one finds it. For me, I find myself returning to the words of the Great Sage:
Just as today, so also through this round of existence thou hast wept over the loss of so many countless husbands, countless sons, countless parents and countless brothers, that the tears thou has shed are more abundant than the waters of the four oceans.
Just so.

Wednesday, May 8, 2013

Hate Generalisations? You Probably Just Hate Statistics

One of the most oft-repeated nonsense claims by a certain type of low-wattage intellectual lefty is that one 'shouldn't generalise'. (For reasons that are worthy of a separate post', this seems to me to be reasonably correlated with people who also proudly announce that they 'don't judge').

Apparently, one of the Worst Things In The World you can do is to notice that information about the generality of a distribution may useful in predicting where a specific point in the distribution will lie.

For those people that don't like to 'generalise', I wonder what, if any, statistical measures they actually find interesting or legitimate.

What is an average, if not a statement that lets one generalise from a large number of data points to a concise summary property about all of the points combined? Or a standard deviation? Or a median?

The anti-generalisers tend to apply their argument ('assertion' is probably a better description) in two related ways, varying slightly in stupidity:

a) One should not summarise a range of data points into a general trend (e.g. 'On average, [Group X] commits murders at a higher rate than [Group Y]').

b) One should not use a general trend to form probabilistic inferences about a particular data point (e.g. 'Knowing statement a), if I also know that person A is in Group X, and person B is in Group Y, I should infer that person A has a higher probability of committing a murder than person B').

Version a) says you shouldn't notice trends in the world. Version b) says you shouldn't form inferences based on the trends you observe.

Both are bad in our hypothetical interlocutor's worldview, but I think version b) is what particularly drives them batty.

But unless you just hate Bayesian updating, the two statements flow from each other. b) is the logical consequence of a).

Now, this isn't a defence of every statement about the world that people make which cites claims a) and b). To a Bayesian, you have to update correctly.

You can have priors that are too wide, or too narrow.

You can make absurd mistakes that P(R|S) = P(S|R).

You can update too fast or too slowly based on new information.

And none of this has even begun to specify how you should treat the people you meet in life in response to such information.

None of my earlier statements are a defence of any of this. The first three are all incorrect applications of statistics. The last one is a question about manners, fairness, and how we should act towards our fellow man.

But there's nothing wrong with the statistical updating.

If your problem is with 'generalising', your problem is just some combination of 'the world we live in' and 'rationality'.

Suppose the example statements in a) and b) made you slightly uncomfortable. Let me ask you the following:

What groups X and Y did you have in mind when I spoke about the hypothetical murder trends example? Notice I didn't specify anything.

One possibility that you may be thinking I had in mind was that X = 'Blacks' and Y = 'Whites'. People don't tend to like talking about that one.

In actual fact, what I had in mind was X = 'Men' and Y = 'Women'. This one is not only uncontroversial, but it almost goes without saying.

As it turns out, both are true in the data.

Do inferences based on these two both make you equally uncomfortable? Somehow I doubt it.

And if they don't, you should be honest enough to admit that your problem is not actually with statistical updating, or 'generalisations'. It's just trying to launder some sociological or political concern through the action of browbeating the correct application of statistics.

So stop patronisingly sneering that something is a generalisation, and using that as an implied criticism of an argument or moral position. Otherwise zombie Pierre-Simon Laplace is going to come and beat yo' @$$ with a slide rule.

Tuesday, April 16, 2013

On the Ex-Ante and the Ex-Post

Some thoughts on the occasion of receiving an email from a friend. He went down to the Boston marathon to watch his friend finish, and was planning to view things at the finish line. He found it too crowded, and walked up the street. This caused him to miss the first explosion, which was right near where he was originally standing. It also put him right next to where the second explosion was. By sheer coincidence, in the shock from the first blast, he started to walk towards the finish line, the site of the initial explosion. This caused him to be just far enough away from the second bomb when it exploded, right near where he'd been. He managed to escape unhurt.

I don't know about you, but studying enough statistics has had a subtle but deep effect on how I view the world. We who aspire to rationality make all our decisions in the realm of ex-ante calculations. When you understand probability, you realize that it doesn't make any sense to regret betting on heads when tails comes up as the winner, just as it doesn't make any sense to thrill at having chosen tails. You can only organise your life around things you know now, and decisions are only truly good or bad when evaluated according to what you knew at the time.

And yet...

When all that's said and done, you don't eat the expectation, you eat the coin flip. Every day, it tumbles through the sky, and all you can do is gird your loins and brace for whatever happens at the end. You plan and plan, and still, one day when you're not thinking, everything comes down to whether or not you took three steps in the right direction or not.

Different people give lots of different names to that - chance, luck, fate, God, Kamma. Ultimately, they're describing the same thing - whether you live to write the email or you don't.

In the end, it just wasn't your day to die. I'm extraordinarily glad of that. You get to see the sunrise and keep your health, and we get to keep our friend. Somewhere else, other people are receiving much sadder emails.

Such is life.

Wednesday, June 6, 2012

Thought of the Day

"No man can ever truly be secure until he has been forsaken by Fortune."
Boethius, The Consolations of Philosophy

Wednesday, March 14, 2012

Thought of the Day

"In death, Alexander of Macedon's end differed no whit from his stable-boy's. Either both were received into the same generative principle of the universe, or both alike were dispersed into atoms.
...
Do you make a grievance of weighing so man pounds only, instead of three hundred? Then why fret about living so many years only, instead of more? Since you are content with the measure of substance allowed you, be so also content with the measure of time."


-Marcus Aurelius, Meditations

Monday, January 16, 2012

Hobbes was right

Apparently a fungus infects carpenter ants, feeding on them and turning them into zombies that walk around erratically. The fungus makes the ant walk towards the understory of the forest, where the fungus grows better, then finally spores grow out of the dead ant's head. (Via Radley Balko.)

The universe is not your friend. All of us are mere grist to the mill of evolution - if there is a niche for some creature (virus/fungus/insect/tiger) to use you successfully as a food source, and they happen to be adapted enough for the purpose, they will do so. If you want to know why I celebrate the triumph of man's economic development and its ability to shape the natural environment, this is why. It's easy to think of nature as some gentle and cute-looking endangered species, like the Iberian Lynx. But you would do just as well to also think of the fungus in Thailand slowly devouring carpenter ants. This, my friends, is the world we live in.

The great Robert Frost observed all this a long time ago.
I found a dimpled spider, fat and white,
On a white heal-all, holding up a moth
Like a white piece of rigid satin cloth --
Assorted characters of death and blight
Mixed ready to begin the morning right,
Like the ingredients of a witches' broth --
A snow-drop spider, a flower like a froth,
And dead wings carried like a paper kite.  
What had that flower to do with being white,
The wayside blue and innocent heal-all?
What brought the kindred spider to that height,
Then steered the white moth thither in the night?
What but design of darkness to appall?--
If design govern in a thing so small. 
Or as Thomas Hobbes put it in Leviathan - the life of man in the natural state is "solitary, poor, nasty, brutish, and short."